Senate Republicans Unite Against Medicaid Cuts in Thune's Tax and Spending Bill

Strategic Insights -

Senate Republicans are growing increasingly resistant to the Medicaid spending cuts included in the tax and spending bill championed by Senate Majority Leader John Thune. The bill, which largely ignores GOP senators' concerns about Medicaid and clean energy tax credits, is facing strong pushback from members of the conference. Senators such as Josh Hawley, Lisa Murkowski, and Susan Collins have expressed major concerns about the Medicaid language in the bill, warning that it would cause dozens of rural hospitals to close in their home states and require lower-income Americans to pay more for medical procedures.

Key Takeaways:

  • The Senate's version of the tax and spending bill cuts Medicaid by several hundred billion dollars beyond what the House proposed, sparking concerns among Republicans about the impact on rural hospitals and lower-income Americans.
  • Senate Majority Leader John Thune faces opposition from at least 3 Republican senators: Josh Hawley (R-Mo.), Lisa Murkowski (R-Alaska), and Susan Collins (R-Maine), who are pushing for changes to the bill's Medicaid provisions.
  • Hawley and other Republicans have warned that the bill's Medicaid cuts would cause nearly half of Missouri's rural hospitals to face closure, and Collins has expressed concerns that the changes to states' use of health care provider taxes would disproportionately affect Maine.
  • Thune and Finance Committee Chair Mike Crapo sided with conservatives such as Sens. Rick Scott (R-Fla.) and Roger Marshall (R-Kan.), who called for deeper spending cuts than what the House passed, but Thune now faces a challenge in winning over Republican colleagues who are balking over the Medicaid cuts.
  • Senate Republicans have ascribed Thune's decision to add even bigger spending cuts in the bill to his sensitivity to the broad desire within the Senate Republican Conference for more deficit reduction, and his need to find hundreds of billions of dollars in spending cuts to offset the cost of making corporate tax cuts permanent.

Statistics:

  • The Senate bill would cut Medicaid by several hundred billion dollars beyond what the House proposed.
  • 10 of Maine's 24 rural hospitals are in danger of closing, according to a report from the Center for Healthcare Quality and Payment Reform.
  • Hawley warned that nearly half of Missouri's rural hospitals would face closure if the Senate bill passes without major changes.
  • The bill would permanently restore immediate deductions for research and development expenses, the 100% bonus depreciation for investments, and the EBITDA-based limitation on business net interest deductions.
  • The legislation would also limit the deduction for pass-through businesses to 20% instead of the House bill's more generous 23% deduction.

Sources:

  • Senate Majority Leader John Thune (R-S.D.)
  • Finance Committee Chair Mike Crapo (R-Idaho)
  • Sen. Josh Hawley (R-Mo.)
  • Sen. Lisa Murkowski (R-Alaska)
  • Sen. Susan Collins (R-Maine)
  • Center for Healthcare Quality and Payment Reform
  • Alexander Bolton, reporting for the Hill.