Senate Republicans suffered a major blow on Thursday as the chamber’s parliamentarian ruled that a slew of their planned Medicaid cuts — key elements of their package of tax and spending cuts — do not meet the rigorous criteria for inclusion in a bill using the special reconciliation process to avoid a Democratic filibuster.
Republicans had been counting on cuts to Medicaid to help offset the cost of their plan for trillions of dollars in tax cuts. The ruling by parliamentarian Elizabeth MacDonough would strip some $250 billion in Medicaid cuts from the Republican plan. It leaves Senate GOP leaders scrambling to make difficult choices, and it may upend their plans to push ahead with votes on the overall package over the coming days as they aim to deliver the legislation to President Donald Trump’s desk by July 4.
Moving ahead: Republicans are reportedly expected to try to rewrite the latest provisions that were struck down, but that process could delay GOP leaders’ plans to start voting on the package on Friday. The ruling may also make it harder for GOP leaders to assuage the concerns of some conservatives who are demanding more spending cuts.
Senate Majority Leader John Thune, a Republican from South Dakota, downplayed the disruption. “These are speed bumps along the way; we anticipated those and so we have contingency plans,” he told reporters. “Obviously, you have to adjust the timing and schedule a little bit, but we’re moving forward.”
But Republican Sen. Ron Johnson acknowledged that this was more than just a minor setback: “I’ll say that was a big old grenade thrown into the process.”
Medicaid limits: Among the latest provisions to be struck down was a divisive proposal to limit a Medicaid provider tax that states use to boost the federal funding they receive for the healthcare program. Some Republicans and hospital groups have raised concerns about that proposal, warning that it could force rural hospitals to close. The parliamentarian also ruled against a provision that would prohibit federal funding to states that allow undocumented immigrants on Medicaid and another that would place new limits on premium healthcare tax credits for immigrants who aren't citizens.
MacDonough had previously rejected an initial GOP proposal to cut the Supplemental Nutrition Assistance Program, commonly known as food stamps, as well as a plan to sell federal land, an effort to gut the Consumer Financial Protection Bureau and a move to restrict the power of federal judges to issue nationwide injunctions.
MacDonough has yet to rule on all portions of the GOP plan, with decisions on the Senate Finance Committee’s proposed tax changes still to come.
Overall, MacDonough has ruled out nearly $600 billion in cuts from the Senate Republican legislation, according to a post on X by Bobby Kogan, the senior director of federal budget policy at the left-leaning Center for American Progress and a former budget staffer in the Senate and at the White House. Republicans reportedly expect to be able to salvage some of the provisions that MacDonough has ruled against, but Kogan wrote that $240 billion or more in planned GOP cuts will remain out of the legislation.
What’s next: While some irate conservative lawmakers called for ignoring or firing the parliamentarian, Thune on Thursday reiterated his opposition to the idea, which would eat away at the Senate filibuster. “No, that would not be a good option for getting a bill done,” he said.
Some senators opposed to the provider tax provision said the parliamentarian’s ruling provided an opportunity to fix the bill. “This is a chance to get it right,” Republican Sen. Josh Hawley of Missouri told reporters. “This is a chance for the Senate to fix this problem they created and not defund rural hospitals.”
The White House insisted that it is sticking to the Independence Day deadline. “We expect that bill to be on the president’s desk for signature by July Fourth,” Press Secretary Karoline Leavitt told reporters.
At an afternoon event at the White House to promote the legislation, Trump falsely claimed that the bill, while slashing spending, won’t cut Medicaid. “We're cutting $1.7 trillion in this bill and you're not gonna feel any of it,” he said. “Your Medicaid is left alone. It's left the same.”
The Congressional Budget Office has estimated that 10.3 million people would lose Medicaid or Children’s Health Insurance Program coverage by 2034 and nearly 8 million more people would be left uninsured due to policies in the House-passed version of the bill. The Senate version included steeper Medicaid cuts.