GOP Senators Struggle to Finalize Healthcare Cuts in 'Big, Beautiful Bill'

GOP senators are grappling with a significant challenge as they work to finalize a major legislative package: how to cut billions from healthcare funding without adversely affecting hospitals or patients. This issue has become a major stumbling block in the progress of the bill, which has been dubbed the 'Big, Beautiful Bill' by President Donald Trump.

The House-passed version of the bill already estimates that 10.9 million more people would lose health coverage. GOP senators have proposed even steeper reductions, which some senators, including Susan Collins of Maine, believe go too far. Collins has expressed concern that the Senate's proposed cuts to Medicaid are deeper than those in the House version, which she finds problematic.

Senators have been engaged in closed-door meetings and consultations with Trump administration officials to finalize the bill ahead of the president’s Fourth of July deadline. While much of the package, including tax breaks and increased border security spending, is largely complete, the specifics of healthcare cuts remain one of the most contentious issues.

This situation echoes the struggles Republicans faced in 2017 during Trump’s first term, when they attempted to fulfill their campaign promise to "repeal and replace" the Affordable Care Act, or Obamacare. That effort ultimately collapsed when then-Sen. John McCain cast a decisive thumbs-down vote, highlighting the party's internal divisions over healthcare policy.

Senate Majority Leader John Thune is determined to avoid a similar outcome and is pushing for a vote by the end of the week. Thune has championed the bill, asserting that it will stimulate economic growth and put money in people’s pockets. The changes to federal healthcare programs, particularly Medicaid, were always intended to be a central part of the GOP package, serving as a means to offset the costs of providing tax breaks for millions of Americans.

The House-passed bill achieved approximately $1.5 trillion in savings, a significant portion of which came from changes to healthcare. The Medicaid program has expanded dramatically since Obamacare became law and now serves around 80 million Americans. Republicans argue that this expansion is unsustainable and aim to reduce the program to cover primarily poorer women and children.

House Democratic Leader Hakeem Jeffries has criticized the bill, stating that Republicans are attempting to strip healthcare from tens of millions of Americans. Democrats uniformly oppose what they refer to as the "big, ugly bill."

Much of the healthcare cost savings would come from imposing new 80-hour-a-month work requirements on Medicaid recipients, despite the fact that most already work. Another contentious provision is the so-called provider tax, which almost all states impose on hospitals and other providers that serve Medicaid patients. This tax is a significant concern for potential cuts to rural hospitals.

Sen. Josh Hawley of Missouri noted that several senators expressed reservations during a private meeting, indicating they were not yet ready to start voting. Hawley emphasized that the fate of rural hospitals is a critical factor in moving forward. States use these taxes to boost federal reimbursements for Medicaid, a system that critics describe as a form of "laundering," but almost every state except Alaska employs it to fund healthcare coverage.

The House-passed bill would freeze provider taxes at current levels, while the Senate proposal goes further by reducing the tax that some states can impose. Sen. Roger Marshall of Kansas acknowledged the states' reliance on these taxes but insisted that the provider tax needs to be eliminated. However, many GOP senators and medical providers in their states are concerned that the proposed changes could devastate rural hospitals.

The American Hospital Association has warned lawmakers that the cuts would not only affect those covered by Medicaid but would also strain emergency rooms as they become the primary healthcare providers for millions of newly uninsured people. Rick Pollack, president and CEO of the hospital group, cautioned that some hospitals, particularly those in rural communities, may be forced to close.

The Catholic Health Association of the United States also expressed grave concerns, noting that Medicaid provides health insurance for one in five people and nearly half of all children. Sister Mary Haddad, the group’s president and CEO, stated that the proposed changes to Medicaid would have devastating consequences, especially for those in small towns and rural communities where Medicaid is often the primary source of healthcare coverage.

In an effort to address these concerns, senators are considering the creation of a rural hospital fund to offset the lost Medicaid money. A proposal to establish a $15 billion rural hospital fund has been circulated, but there is disagreement over the appropriate size of the fund. Collins has proposed a $100 billion fund, while others argue that this amount is too high or insufficient. Thune acknowledged that a fund will be created but did not specify its size.

Hawley, who has been vocal about the healthcare cuts, expressed interest in the rural hospital fund but sought more details on its implementation. He also raised concerns about a new $35 per service co-pay for Medicaid recipients, which is included in both the House and Senate versions of the bill. Hawley questioned how the fund would distribute money to hospitals and whether it would be more than just a paper proposal.