An ambitious House bill to cut taxes by hundreds of billions of dollars and pay for part of it by slashing Medicaid spending faces a rocky path in the Senate, where Republican lawmakers warn the changes to the safety net program could hurt rural hospitals and reduce benefits for their constituents.
Republican senators are also raising red flags about the House plan’s phase-out of renewable energy tax credits and what they’re calling an inadequate attempt to reduce the ballooning federal deficit.
Senate Republicans have given Speaker Mike Johnson (R-La.) space to put together a bill that can muster the 218 votes it needs to pass the House. But they’re warning that it’s going to get a facelift when it reaches the Senate, where Republicans who represent rural states say they will take a careful look at proposals that could throw millions of Americans off their health insurance.
Sen. Josh Hawley (R-Mo.) said he’s fine with the new work requirements and antifraud provisions that House Republicans have proposed for Medicaid, but he raised concerns about their “cost-sharing proposal,” which he said would make “beneficiaries pay more.”
“These are working people in particular who are going to have to pay more,” he said.
He also questioned language in the House bill to limit states’ flexibility to use health care provider taxes to increase the federal share of Medicaid spending — a strategy many states use to draw more Medicaid dollars from Washington.
“The provider tax in particular, that could have a big impact in my state and lead to reduced coverage, so I’ve got some concerns. I think we need to look really, really carefully at that. I continue to maintain my position we should not be cutting Medicaid benefits,” he said.
A Congressional Budget Office (CBO) analysis of the legislative proposal drafted by the House Energy and Commerce Committee, which has jurisdiction over Medicaid, found it could result in 8.6 million people losing their health care coverage.
Sen. Thom Tillis (R-N.C.), who faces a competitive reelection race next year in a swing state, said the House proposal will need to be revised once it gets to the Senate.
He said he’s looking carefully at House language to cut Medicaid spending and phase out clean-energy tax breaks that have created new jobs in his home state.
“We’re going through some of the details today,” he said.
Tillis says he’s open to scaling back some of the health care subsidies under the Affordable Care Act that were increased during the COVID-19 pandemic, when federal spending exploded. But he doesn’t want to cut the federal health care safety net to below where it was before the pandemic.
“We just got to make sure that what we had pre-COVID as a safety net still exists and people have access [to health insurance] in the marketplace,” he said. “We’ve got a lot of work to do before, I think, the details are settled.”
Tillis says he wants to dig in to the projection that more than 8 million people could lose their insurance.
“We’re looking at that,” he said. “If it’s that many, we have to look at what’s happened — if that’s just the expansion population, if that’s work requirement.”
Paul Winfree, the president and CEO of the Economic Policy Innovation Center, a conservative-leaning research group, said that 1.4 million people who would lose coverage under the CBO’s projection are those who entered the country without authorization, another 1.2 million are currently ineligible for the program, and 4.8 million are healthy adults who will decide not to work.
Sen. Susan Collins (R-Maine) said she’s inclined to support new work requirements for Medicaid, but she warned the House’s proposed reforms for how states use health care provider taxes to collect more federal money would hurt her home state.
“It looks like from a very quick review that the way provider taxes are treated would be very harmful to Maine’s hospitals,” she said.
Hawley also expressed concern about the House bill’s impact on rural hospitals.
“I’m worried about that,” he said. “We’ve seen a lot of them close in my state, and I don’t want to see any more close.
“We’re a majority-rural state,” he said. “We are already, as it is, we are struggling with rural health care coverage. Republicans, we need to be making that better, not worse.”
Sen. Lisa Murkowski (R-Alaska) said Senate Republicans discussed the “different proposals” in the House at their retreat last week.
“Everything’s a moving target until it stops,” she said.
She said her colleagues’ worries that the House reforms may hurt rural health care providers are valid.
“That’s why people like Josh [Hawley] and myself and others have weighed in very early … in saying that Medicaid cuts that hurt states like Alaska — that is heavily reliant on Medicaid — are not going to be acceptable,” she said. “How we navigate this is something we’re all trying to wander through.”
Senate Majority Leader John Thune (R-S.D.) told reporters Tuesday that Senate Republicans are waiting to review the details of the bill the House finally passes but indicated that the Senate is likely to make significant changes.
“We are coordinating very closely with our House counterparts at the committee level, at the leadership level. We know they have to get 218 votes and so they’re going to do what it takes to get it done in the House,” he said.
Thune said his leadership team is exploring “various contingencies” about how to handle the House bill when it comes across the Capitol
He said one option is “taking up the House bill” on the floor “and offering a Senate substitute.”
Some Republican senators are also raising concerns about the House GOP’s plan to aggressively phase out federal tax credits for clean energy investments. Advocates for solar and wind energy say it could cost thousands of American jobs.
For example, Climate Power, a nonprofit group, says $20 billion in funding from the Biden-era Inflation Reduction Act has helped create more than 17,000 jobs in North Carolina.
Tillis said that legislative language needs to be changed.
“We got to look at it. We got to probably work on some refinement, I think, to probably get most of our members on board,” he said. “We’ve got to be very judicious.
“You can’t shock the markets by doing it all at once,” he said of suddenly ending an array of clean energy tax incentives.
Sen. Shelley Moore Capito (R-W.Va.) said she would take a close look at the House plan to terminate the 45V clean hydrogen production tax credit.
“We have a hydrogen hub, so we’ll have to look at that closely,” she said, referring to her state’s Appalachian Regional Clean Hydrogen Hub, which was slated to receive a $925 million award from the Department of Energy.
