Returning to Washington from a two-week recess last week, House Republicans have advanced a budget resolution that instructs the Energy and Commerce Committee to identify $880 billion in spending reductions over the next decade, with Medicaid being a primary target. Specific proposals under consideration include:
- Work Requirements: Implementing work requirements for able-bodied adults aged 19–55 without dependents, potentially reducing enrollment by 1.5 million and saving $109 billion.
- Scaling Back Medicaid Expansion: Reducing federal funding for the Affordable Care Act’s Medicaid expansion, which could affect up to 20 million beneficiaries and shift $246 billion in costs to states.
- Per-Capita Caps: Establishing fixed federal funding limits per enrollee, which could force states to cut benefits, eligibility, or provider payments.
- Eliminating Provider Tax Loopholes: Closing loopholes that allow states to draw extra federal funds, potentially leading to reduced services.
Democrats have launched the “Fight to Save Medicaid” campaign, targeting vulnerable Republican lawmakers and organizing town halls to rally public opposition against the proposed cuts.
The proposed cuts have created divisions within the Republican Party. Moderate Republicans, such as Rep. Don Bacon, have expressed concerns about the depth of the cuts, advocating for a cap at $500 billion and emphasizing the need to protect healthcare quality for vulnerable populations. Other key Republicans include Rep. Jeff Hurd (CO), Rep. Vern Buchanan (FL) and Rep. David Valadao (CA). An additional group of 12 centrist and swing-district House Republicans sent a letter to Speaker Mike Johnson, warning they would not support a budget reconciliation package that significantly cuts Medicaid coverage for vulnerable populations. This collective stance underscores the challenges GOP leadership faces in unifying the party around the proposed budget cuts.
What should healthcare leaders do?
Hospital and health system leaders have a crucial voice in this debate. The next several weeks will be pivotal.
- Assess Financial Impact: Quantify how cuts would affect your organization’s revenue, patient coverage, and uncompensated care burden.
- Engage Lawmakers: Advocate directly with key members of Congress, especially moderates, to oppose harmful Medicaid reductions.
- Mobilize State Partnerships: Coordinate with state hospital associations, Medicaid directors, and policymakers to push back against cost-shifting to states.
- Inform the Public: Launch campaigns that show how cuts would harm access to care for vulnerable populations in your community.
- Prepare Operationally: Develop contingency plans for staffing, budgets, and care delivery under multiple funding scenarios.
