Senate GOP Pushes Medicaid Cuts, Keeps SALT Cap in Trump Bill/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ Senate Republicans unveiled a draft of President Trump’s sweeping economic legislation that proposes deeper Medicaid cuts and preserves the $10,000 SALT deduction cap, diverging from the House version. The bill also features enhanced tax breaks for seniors and over $1 trillion in program cuts. GOP leaders aim for passage by Trump’s July 4 deadline.
Trump Tax Bill Quick Looks
- Medicaid cuts deepened: Senate proposes new work rules, provider tax reductions.
- SALT cap clash: Senate keeps $10K limit, drawing ire from GOP lawmakers.
- Senior benefits expanded: Tax break raised to $6,000 for qualifying retirees.
- GOP unity tested: Senators face backlash from high-tax state Republicans.
- Billions in savings: Cuts target green energy, SNAP, and healthcare programs.
- ICE funding up: $175B added for deportations and Homeland Security growth.
Senate GOP Pushes Medicaid Cuts, Keeps SALT Cap in Trump Bill
Deep Look
Senate GOP Unveils Sweeping Adjustments
On Monday, Senate Republicans introduced a draft version of President Donald Trump’s signature legislative package, intensifying efforts to reshape Medicaid, preserve tax breaks, and meet Trump’s deadline to deliver results by July 4.
The legislation includes new Medicaid work requirements, especially for parents of teens, and retains the $10,000 state and local tax (SALT) deduction cap, sparking conflict with GOP lawmakers from high-tax states who had won a $40,000 cap in the House-passed bill.
Focus on Fiscal Cuts and Tax Relief
At the heart of the Senate draft are changes to:
- Medicaid: Expanded work requirements for adults ages 18–64, including parents of children over 14.
- Green energy: Slower rollback of tax incentives; immediate elimination of EV credits.
- Tax breaks for seniors: Increased to $6,000 for individuals making up to $75,000 or couples making $150,000.
- ICE and Homeland Security: Boosted by $350 billion, including funds for 10,000 new ICE agents.
Senate Finance Committee Chair Sen. Mike Crapo called the bill a means to prevent tax hikes and deliver “significant savings” by reducing waste and repealing select Biden-era programs.
Medicaid Reforms and Rural Pushback
A central controversy is the broadening of Medicaid work requirements, which were first introduced in the House but now include more parents. Adults would need to work 80 hours per month or perform community service.
Additionally, the Senate version phases down the provider tax—a tool used by most states to help fund Medicaid—from 6% to 3.5% by 2031, alarming rural healthcare advocates.
Sen. Josh Hawley of Missouri warned, “This needs a lot of work. Rural hospitals are going to be in bad shape.”
SALT Cap Becomes Flashpoint
The decision to retain the $10,000 SALT cap ignited backlash from House Republicans representing high-tax states.
Rep. Nicole Malliotakis (R-NY) called the move “a slap in the face,” while the House SALT Caucus insisted the $40,000 compromise must stay in the final version. The internal dispute signals a rough path ahead for final passage.
Cuts to Food Assistance and Medicaid Co-Pays
The bill expands SNAP work requirements to include older adults and more parents, and imposes a $35 co-pay on Medicaid patients above the poverty line (with exceptions for pediatric and emergency care).
Analysts warn that the changes, if implemented, could lead to over 10 million fewer people with health coverage, per the Congressional Budget Office (CBO).
Budget, Deficit, and MAGA Skepticism
The House-passed bill would add $2.4 trillion to the deficit over 10 years, the CBO reports. It also outlines:
- Tax breaks for the wealthy: Up to $12,000 annually.
- Minimal relief for low-income households: A potential $1,600 tax increase.
- Middle-class benefits: Tax cuts between $500 and $1,000.
Sen. Ron Johnson (R-WI) and other conservatives remain uneasy with the bill’s size and $5 trillion debt ceiling increase, warning the legislation doesn’t go far enough on cuts.
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