GOP Clashes on Deep Medicaid Reductions as July 4 Deadline Looms/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ Senate Republicans are divided over Medicaid cuts aimed at offsetting tax breaks, with concerns surfacing about the impact on 10.9 million newly uninsured Americans and rural hospitals facing closure. Efforts to establish a rural hospital fund—ranging in proposals from $15 billion to $100 billion—reflect negotiation stalemates amid co-pay and provider-tax battles. White House economic analysis forecasts $2.3 trillion in deficit reduction, but watchdogs warn of potential harm to vulnerable communities if healthcare provisions are rushed.
Quick Look
- Medicaid Cuts Tension: House plan increases uninsured by 10.9 million; Senate GOP floats deeper reductions.
- Provider-Tax Clash: Senate proposal scales back state-collected provider taxes; hospitals warn it could shutter rural ERs.
- Rural Hospital Fund: Proposals range from $15 billion to $100 billion to mitigate harm; senators question distribution mechanisms.
- New Co-pay Rule: $35 per-service co-pays for Medicaid recipients spark dissent among Republicans.
- Economic Impact: White House Council of Economic Advisers projects $2.3 trillion in 10-year savings vs. CBO’s $2.8 trillion deficit increase forecast.
GOP Clashes on Deep Medicaid Reductions as July 4 Deadline Looms
Deep Look
WASHINGTON (AP) — As President Donald Trump’s massive tax-and-spending package nears the finish line, one key issue — Medicaid cuts — threatens to stall progress and produce political blowback.
At the heart of the dispute is how to trim Medicaid funding without harming millions of Americans. Under the House-passed version, an estimated 10.9 million more people would lose health coverage. Senate Republicans have proposed even deeper reductions — a move that moderate GOP Sen. Susan Collins warns is “problematic.”
“The Senate cuts in Medicaid are far deeper than the House cuts,” Collins said, voicing widespread concern.
Senators have huddled behind closed doors with administration officials to navigate the impasse, with a July 4 deadline looming — the date Trump wants the final bill on his desk. The package includes expansive tax cuts and border spending, but healthcare claws at the fragile consensus.
Back in 2017, a similar political fight over repealing the Affordable Care Act caused Sen. John McCain’s “thumbs-down” moment, derailing the repeal effort. Senate Majority Leader John Thune is determined to avoid a replay, saying this legislation is “a good bill… great for our country,” and driving forward with votes expected by week’s end.
To offset the bill’s cost — estimated in part at $1.5 trillion in savings — Republicans agreed to tighten Medicaid eligibility, imposing 80-hour monthly work requirements, even though most beneficiaries already work. Further complicating matters is a salty debate over the provider tax, which states impose on hospitals and healthcare providers to draw down federal Medicaid funding.
The House version freezes provider taxes, while Senate Republicans aim to reduce them, prompting dire warnings from hospitals:
“Some hospitals, especially those in rural communities, may be forced to close altogether,” Rick Pollack of the American Hospital Association cautioned.
The Catholic Health Association echoed the alarm:
“The proposed changes to Medicaid would have devastating consequences, particularly for those in small towns and rural communities,” said Sister Mary Haddad.
In response, Republican senators are considering a rural hospital fund to plug Medicaid shortfalls. A proposal for $15 billion was circulated, but opinions vary — with Collins suggesting up to $100 billion may be needed.
“It won’t be that big, but there will be a fund,” Thune confirmed, while Sen. Josh Hawley remained cautious about its structure and real-world impact.
Another sticking point is the introduction of a $35 per-service co‑pay in both House and Senate versions. Critics argue this will burden the poorest recipients, with Hawley expressing skepticism:
“Getting the fund is good… But how does the fund actually distribute the money? … Or is this just going to be something that exists on paper?”
Amid the gridlock, economic perspectives diverge sharply. The White House Council of Economic Advisers calculates up to $2.3 trillion in 10‑year deficit reduction. However, the nonpartisan Congressional Budget Office estimates the House version would increase the deficit by $2.8 trillion over the same period.
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