Medicaid Decrees by Senate Parliamentarian Deal Blow to Tax Bill

A Senate rulekeeper determination that several major provisions focused on cutting Medicaid spending violate the chamber’s rules deals a heavy blow to Senate Republicans’ tax and spending bill.

Senators have been scrambling to finalize their tax bill—a major priority for President Donald Trump—this week to meet a self-imposed July 4 passage deadline. The chamber’s independent rulekeeper’s decision, announced early Thursday in a release from Senate Budget Committee ranking member Jeff Merkley (D-Ore.), could delay lawmakers’ attempts to pass the legislation (H.R. 1) under reconciliation without needing Democratic support.

The rulings from Senate Parliamentarian Elizabeth MacDonough could result in more than $250 billion in health care cuts being removed from the bill, Sen. Ron Wyden (D-Ore.), ranking member on the Senate Finance Committee, said in a statement.

Bill Hoegland Balance of Power to report on Medicaid decrees from Trump Tax Bill.

Provider Taxes, Immigrants

A major provision that was ruled out of bounds would limit states’ use of provider taxes in financing their portion of Medicaid. These taxes are used in most states and can help boost payments to providers. The Senate proposed to go further than the House in limiting states’ ability to use this financing mechanism, spurring concerns from some Republicans and hospital lobbyists about the effects on health facilities.

Senate Republicans are discussing including a potential fund to help rural hospitals, but as of Wednesday lawmakers were not settled on an amount.

Other measures considered in violation of Senate rules aimed to limit immigrant participation in Medicaid, including one that would reduce federal Medicaid funding for expansion states that cover undocumented immigrants, the release said.

According to a nonprofit research group KFF analysis of the similar House measure, this would penalize 14 states and Washington D.C., including California, New York, and Oregon. The measure would specifically lower the federal matching rate for these states’ expansion population from 90% to 80%. KFF estimates this change would shift $92 billion in costs from the federal government to the states over the next ten years if the states kept their programs.

The parliamentarian also contested a proposal that would revoke Medicare eligibility from certain immigrants, including refugees and those granted asylum. Another measure that didn’t make the rules hurdle would have prohibited federal dollars from going to Medicaid coverage for individuals whose citizenship or immigration statues cannot be verified.

Proposed limitations on providing certain immigrants premium tax credits were also considered out of compliance.

Gender-Affirming Care, Planned Parenthood

An additional proposal that didn’t clear the parliamentarian’s hurdle was a repeal of funding for gender-affirming care for Medicaid, a hot button culture debate. The Supreme Court recently upheld a Tennessee ban on transgender care for youths.

The independent rulekeeper is still considering a measure that would prohibit Medicaid payments to Planned Parenthood, Merkley said.

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