Three reasons why Republicans cut Medicaid

Yahoo

6 hours ago

More Medicaid enrollees are voting Republican — a result of President Donald Trump's success in wooing lower-income voters. So, why did the GOP slash deeply into the health insurance program in its megabill?
Three reasons: Republicans desperately needed money to avoid a big tax increase next year, they wanted to claw back Biden-era policies GOP lawmakers say led to lax eligibility checks and more fraudulent benefit claims and they wanted to curb the Medicaid expansion enacted by then-President Barack Obama and congressional Democrats in the Affordable Care Act.
The bill targets unsustainable spending by adding work requirements and restricting tools states use to get more federal dollars, not the benefits of people who really need them, Republicans said.
'We secured Medicaid for those who need it most: mothers, children, seniors and people with disabilities,' said Kentucky's Brett Guthrie, who crafted the Medicaid provisions in the House. 'Democrats continue to fearmonger and misrepresent what is in this bill.'
The Republican base now includes more working-class and low-income people, many of whom receive their health insurance through Medicaid. But the traditional sentiment of many Republican lawmakers toward the social safety-net program — that it provides handouts on taxpayers' dime — has largely remained the same.
That's become increasingly clear over the past few days and months as Republican lawmakers have crafted their One Big Beautiful Bill Act. The sweeping legislation — which passed Thursday and is now headed to Trump's desk — includes more than $1 trillion in health care cuts, the vast majority of which come from the federal-state health insurance program that serves more than 70 million low-income Americans.
That helped create the budget savings needed to extend trillions in tax cuts a previous Republican Congress and Trump enacted in 2017. They otherwise would have expired at year's end.
As Republicans began to consider their bill in January, Trump promised to 'love and cherish' Medicaid. But he ultimately embraced the cuts as necessary to get the bill passed and lobbied reluctant GOP representatives and senators to go along.
'A lot of the policy agenda of the party is still kind of rooted in a libertarian, Ronald Reagan, Paul Ryan, kind of [viewpoint]' said Jake Haselswerdt, an associate professor at the University of Missouri's Truman School of Government and Public Affairs. 'The economic populism has not been fully embraced yet.'
Only next year's election will show whether Republicans face a reckoning from their new Medicaid-dependent constituents.
Republicans have argued that the cuts — expected to cost millions of people their insurance — were not cuts at all, but instead aim to eliminate waste, fraud and abuse. Conservatives have pointed to rapid spending growth and the ability of states to work the system to extract more federal dollars. 'Medicaid expenses have risen uncontrollably,' the Manhattan Institute think tank said last year in urging an overhaul.
The institute's report urged reforms that would protect 'the program's mandatory acute-care spending' while going after 'expansions of eligibility and benefits made at the discretion of states.'
That's what Republicans aimed to do, said Georgia's Buddy Carter, who worked closely with Guthrie on the Medicaid provisions in the House. The bill 'saves and sustains Medicaid and is there for those who truly need it,' he said during the floor debate Thursday.
Republicans of yesteryear might have pursued a more direct approach, proposing to cap federal spending with a block grant or to eliminate the Obamacare expansion. Republican lawmakers did consider those options, but opted instead to include work requirements for some people on the program and to crack down on loopholes they say states and hospitals abuse to enrich themselves through more federal money.
'They have this justification of going after waste, fraud and abuse, so you could argue that the shifting politics of Medicaid did affect them,' said Haselswerdt. 'It did kind of shift the window of what was possible. But obviously the window of what was possible still includes what amounts to very sizable cuts.'
Republicans say the changes are sorely needed to reverse problems that erupted in the Biden administration. They point to lax eligibility controls that saw coverage explode during President Joe Biden's tenure.
'Biden-era policies led to enormous enrollment of people not eligible and corporate welfare through Medicaid payments well in excess of Medicare rates,' said Brian Blase, president of Paragon Health Institute, a conservative think tank.
The megabill's tax provisions are costly, and Republicans needed to find some way to offset them — to both appease deficit hawks in their ranks and comply with Senate rules that require budget bills to be deficit-neutral within a 10-year window.
Other entitlements like Medicare and Social Security, which both serve elderly people, were deemed too politically risky to touch. Trump has been even more adamant about not reducing benefits in Medicare and Social Security, a cornerstone of his first campaign in 2016, than he was about Medicaid.
Cutting programs for the elderly is a third rail that Republicans have learned to steer clear of after getting burned when then-President George W. Bush and then-Speaker Paul Ryan tried.
Republicans also largely see the two programs as earned entitlements because they are funded with payroll taxes, whereas Medicaid is still viewed by many in the party as a handout, even though most recipients work, policy experts said.
'Social Security and Medicare also clearly have a beneficiary group of elderly who are politically active, but Medicaid is politically easier to go after because you're talking about kids and poor people and people with disabilities,' said Chris Howard, a professor of government and public policy at William & Mary in Virginia.
With Social Security and Medicare off the table, Medicaid became one of the only targets for Republicans to find cuts of the size they needed to pay for Trump's policy priorities.
'When you have to pay for stuff in the federal budget, there are only a couple of programs they can look at,' said GOP health strategist Joel White, president and CEO of the consulting firm Horizon Government Affairs. 'The money lined up.'
Trump's remaking of the Republican Party aside, the rhetoric around the Medicaid debate was familiar to anyone who's paid attention to politics over the last several decades.
Republicans said the Medicaid expansion had exploded the welfare state by allowing 'video-game-playing young men' too lazy to work to enjoy taxpayer-funded health care. Democrats said Republicans were shredding the social safety net to pay for tax cuts for billionaires.
The nonpartisan Congressional Budget Office estimated an earlier version of the bill would lead to a $1.1 trillion cut to health spending over the next decade and 11.8 million people tossed off coverage. The CBO does not have an updated score yet on the version of the bill that narrowly passed the House on Thursday after several health provisions were dropped, such as a penalty on states for coverage of undocumented immigrants.
Recent polling shows that Democrats appear to be winning the messaging war. A poll released June 26 from Quinnipiac University found 55 percent of U.S. voters were opposed to the bill compared with 29 percent in support and 16 percent didn't have an opinion. Another poll from health research group KFF found 64 percent of U.S. adults opposed the bill and 35 percent were in favor.
'The combination of these deep cuts to food and health care, which most people strongly believe are important kinds of benefits, and the tax cuts for the rich — it's going to be very easy for Democrats to portray Republicans as the sort of heartless friends of the rich,' said Howard.
White said Republicans have long had problems talking about health care, and lawmakers must keep to their message that the policy changes go after abuses.
'There are simple things they can say: 'If you are an able-bodied adult, you need to work or volunteer in your community and get educated,'' he said.
White added that Republicans need to explain more clearly why the cuts are necessary to shore up the program for those truly in need and that those kicked off can obtain insurance through an employer or an Obamacare exchange.
'All members of Congress need to say what is at stake, which is the integrity and long-term stability of the Medicaid program,' he said.