US Senate GOP Mega-Bill Faces Setback as Court Rules Against Medicaid Cuts

WASHINGTON — A significant ruling by the U.S. Senate parliamentarian on Thursday has dealt a blow to Senate Republicans’ plans regarding Medicaid adjustments in their proposed reconciliation package. The decision indicates that several changes do not align with the rules governing such legislation, eliminating billions in potential savings that were intended to offset tax cuts.

Finance Committee Chairman Mike Crapo, R-Idaho, now faces the challenge of either amending or entirely discarding nine proposed changes to healthcare programs. The ramifications of these changes could ripple across the GOP’s tax and spending cut bill, already aimed at extending the 2017 tax cuts.

Notably, Republicans can no longer attempt to curtail federal matching funds for states providing Medicaid to undocumented immigrants. Additionally, a proposal to limit gender-affirming care for Medicaid patients has been rejected, along with plans to cut Medicaid provider tax credits — a contentious issue that has sharply divided GOP members.

These required adjustments may deepen the anticipated deficit impact of the proposed legislation over the next decade. Senate GOP leaders had aimed to initiate procedural votes as early as Friday, hoping to maintain their timeline before the Fourth of July.

Previous discussions had stalled due to concerns over how Medicaid modifications would affect rural hospitals and communities. Senate Budget Committee ranking member Jeff Merkley, D-Ore., released the parliamentarian’s findings and emphasized the Democrats’ ongoing efforts to eliminate proposals deemed incompatible with reconciliation requirements.

Merkley criticized Republican attempts to reshape the bill, asserting that they prioritize affluent interests over middle-class needs. Meanwhile, Finance Committee ranking member Ron Wyden, D-Ore., declared that the ruling will remove over $250 billion in healthcare cuts from the Republicans’ proposal, dubbing the bill “rotten to its core.”

The parliamentarian is yet to determine whether other health provisions, including those affecting Planned Parenthood funding, adhere to reconciliation regulations. Additionally, the fate of a Biden-era rule requiring around-the-clock nursing staff in nursing homes is pending review.