(Communication from the Congressional Progressive Caucus Center, 5/30)
The House-passed Republican megabill now waits for the GOP-controlled Senate to pass the bill the House sent over, change it and send it back to the House to vote on again, or fail to coalesce around any version at all. Below, we’ll walk through the latter two options and their implications, including the next decision points they’d tee up for Congress.
For a high-level summary of the House-passed bill, see our May 22 update. For a rundown on the reconciliation process Congress is using to advance this megabill, see The Basics of Budget Reconciliation.
|
|
|
If the Senate changes the megabill
|
WHY IT COULD HAPPEN
Even though the bill just squeaked by in the House, President Trump gave Republican senators the go-ahead to change it—and they seem eager to do just that. Several GOP senators have expressed qualms with a higher SALT deduction cap, a rapid end to clean energy tax credits, forcing SNAP costs onto states, the severity of the bill’s Medicaid cuts, and more. Plus, some provisions may get axed because they don’t adhere to the Senate’s reconciliation rules (a.k.a., they violate the Byrd rule).
While House Speaker Mike Johnson (R-LA) has implored senators not to mess with the package House Republicans crafted, the President’s comments gave senators the green light. On top of that: the Senate has had the final say on all of the reconciliation efforts that have become law over the past 15 years: the Affordable Care Act, the Tax Cuts and Jobs Act, the American Rescue Plan, and the Inflation Reduction Act. Folks may have different opinions on why this happens—e.g., whether House members are more sensitive to White House primary threats, or whether the Senate’s onerous rules for reconciliation bills gives the chamber added leverage.
Either way, recent history is on the Senate’s side.
WHAT WOULD HAPPEN NEXT
House passage, again
Reconciliation’s rules require both chambers to pass an identical bill—meaning, any Senate changes would force the House to vote again on the updated measure before it can go to the President to be signed into law.
As a reminder, Republicans are using this megabill to raise the debt ceiling, which they must do before August to avoid the U.S. defaulting on its debts. If the Senate doesn’t act imminently and approves their changes later in June or July, they’ll put enormous pressure on the House to take or leave whatever the Senate passes. The cost of not taking up the Senate-approved bill would be high for House Republicans, between a looming debt default and resulting economic crisis and, accordingly, major pressure from the White House to get in line.
Odds are that if the Senate can pass something, the House is going to take it—and if they do, House passage would let the bill go to the President to be signed into law.
|
|
|
Dealing with looming Medicare cuts
To be clear: this bill becoming law is not a given, as I’ll get into below. But, for the sake of teasing out the big moments to watch, let’s say the GOP megabill does become law. That will not be the end of Congress’s work related to this bill this year because of something called “statutory PAYGO.” I’ll do my best to explain what this means and its implications without getting too into the weeds, so stay with me!
Statutory PAYGO refers to the Statutory Pay-As-You-Go Act, a 2010 law that mandates automatic cuts to certain mandatory programs in the event legislation adds too much to the federal deficit (see sidebar A for more on “mandatory” programs). According to the nonpartisan Congressional Budget Office (CBO), the Republican megabill falls into that category.
CBO confirmed that by increasing the deficit by $2.3 trillion over the next 10 years—now more like $4 trillion once you account for costly last-minute changes—the Republican megabill will trigger major, automatic cuts on top of those already in the bill itself.
|
|
|
|
Certain mandatory programs, like Social Security, are exempt from these cuts. Others, like Medicare, are not—though cuts to Medicare are capped at 4 percent. CBO estimates that the GOP megabill will bring about $500 billion in Medicare cuts over the next decade.
Past laws—including the Tax Cuts and Jobs Act (TCJA) and the American Rescue Plan (ARP)—similarly crossed this deficit threshold and would have brought about automatic cuts, had Congress not acted to waive statutory PAYGO or delay its impacts (in a short-term spending bill for the TCJA, and a standalone bill plus a short-term spending bill for the ARP).
Congress cannot include that waiver in the GOP megabill itself. Doing so would, again, violate the Byrd rule. Congress must waive statutory PAYGO separately in a bill that’s not moving via reconciliation.
This means in order to avoid massive cuts to Medicare and other programs, Congress must approve a waiver, and it’ll take Democratic support to get that waiver the requisite 60 votes in the Senate.
Should the Republican megabill become law, expect conversations on this waiver to emerge around the next must-pass bill Congress considers—like when government funding expires in September—as well as conversations about what Democrats might demand in exchange for those votes.
|
If the Senate doesn’t pass anything
|
WHY IT COULD HAPPEN
As we’ve discussed in previous updates, this bill passing the House does not guarantee it will become law—and the longer discussions drag on in Congress, the more likely negotiations will fall apart entirely.
Let’s say we get to July and the bill is stalled. The expiring tax laws that prompted this entire legislative exercise don’t sunset until the end of the year—however, the U.S. is expected to reach the debt limit in August. Accordingly, Treasury Secretary Scott Bessent has asked Congress to raise or suspend that limit by mid-July.
While the GOP-controlled Congress intends to use their megabill to raise the debt ceiling, it does not have to do this. Congress could pass a standalone bill to raise or suspend the debt limit (reconciliation’s rules only allow Congress to increase the limit, not suspend it).
However, not doing this in the megabill means the GOP loses reconciliation’s big benefit of getting through the Senate with just a simple majority vote.
WHAT WOULD HAPPEN NEXT
If the reconciliation effort stalls and the debt ceiling has to move independently, that measure will take 60 Senate votes to pass—meaning, Republicans must secure Democratic votes.
This gives Democrats in the Senate substantial leverage to extract concessions from Republicans, as Republicans have historically done when the roles have been reversed. While Republicans may not want to have that negotiation, if the megabill is at a standstill, they may have to in order to avoid a debt default and the resulting economic fallout on President Trump’s watch.
|
|
|
—————-
National Field Strategy Call
Message from FamiliesUSA dated 5/30:
The Senate will return from their recess next week to take up consideration of the House-passed ‘One Big Beautiful Bill Act.’ Republican leadership in the Senate has indicated they plan to move quickly with the goal of passing their version of the bill July 4. They have also indicated they are unlikely to hold hearings on the bill, so they can shield themselves from public scrutiny for pursuing deep cuts to Medicaid, the ACA, and other vital health programs. This means it is up to us to make our voices heard so Senators know how health care cuts will impact people in their states.
The Asian & Pacific Islander American Health Forum, Caring Across Generations, Center for American Progress, Coalition on Human Needs, Committee to Protect Health Care, Community Catalyst, Community Change, Debt Collective, Families USA, Leadership Conference on Civil and Human Rights, Little Lobbyists, National Education Association, National Health Law Program, Protecting Immigrant Families, Protect Our Care, and other health care leaders invite you to join a National Strategy Field Call on Wednesday, June 4 at 3:00 PM ET.
Date: Wednesday, June 4
Time: 3:00 PM ET
Registration: https://us06web.zoom.us/webinar/register/WN_4ogPwZ0pR-eX88KmV1P_1g
On the call, we’ll:
- Outline the state of play in the Senate and where the reconciliation process stands;
- Detail the harmful pieces of the bill that are in play in the Senate’s consideration of the House Reconciliation bill;
- Highlight actions people across the country are continuing to take to demonstrate opposition; and
- Give you the tools and resources to make your voice heard.
———————-
Medicaid Cost-Cutting Measures Passed by House to be Scrutinized by GOP Senators as They Take Up Trump Agenda
By Kaia Hubbard and Caitlin Yilek, CBS News, 5/29/25
Washington — The Senate will soon be considering the massive legislation containing President Trump’s second-term agenda after House Republicans passed it last week, following days of negotiations over changes to Medicaid, among other key issues.
Senate Republicans will put their “imprint” on the bill, as Senate Majority Leader John Thune of South Dakota put it, and some pointed to changes to Medicaid as a possible red line for those who are undecided. As recently as Memorial Day weekend, at least one, Sen. Susan Collins of Maine, said she’s still going over the House bill: “I’m still looking at it because it kept changing up until literally the very minute it passed.”
Medicaid is the popular entitlement program that provides government-sponsored health care for low-income Americans and people with disabilities. The federal government shares the costs of the program with states, shouldering a minimum of 50% of the costs for richer states, while contributing more for the poorest. In 2025, it paid 77% of the Medicaid costs for Mississippi.
Here’s what to know about the changes to Medicaid in the House measure and the reaction so far by some GOP senators who have said they’re concerned about the Medicaid provisions:
Potential Republican opposition in the Senate
Some of the House’s Medicaid provisions may face resistance in the Senate. And with a narrow majority, Senate Republicans can only afford to lose three of their members if everyone votes.
Collins and Sen. Lisa Murkowski of Alaska, who have been willing to break with their party on certain issues, say changes to Medicaid must not hurt their states. And the two senators, along with Sen. Josh Hawley of Missouri, supported an amendment to the budget resolution that would have removed the language instructing the committee that oversees Medicaid from finding $880 billion in cuts. That amendment failed.
In a New York Times opinion piece earlier this month, Hawley called “slashing health insurance for the working poor” both “morally wrong and politically suicidal.” And although he’s outlined his support for the legislation’s work requirements, he’s drawn a red line on any Medicaid benefit cuts.
Expanding Medicaid work requirements
The legislation includes new work requirements that would apply to childless Medicaid recipients without disabilities between the ages of 19 and 64. A last-minute amendment to the bill would speed up the implementation of the work requirements from Jan. 1, 2029, to no later than Dec. 31, 2026 — a change sought by hardliners. There are exemptions for those who are caregivers for dependent children or who are pregnant, among others.
Hawley likes the idea of work requirements and told the Washington Examiner in February that it’s “probably something that unites Republicans.” Collins recently also said she supports some work requirements, and Murkowski, in a conversation with the nonprofit Foraker Group, suggested that she could support them — as long as its implementation is overseen by states, which could have “some level of flexibility” in applying the requirement.
In a state like Alaska, Murkowski said, “It’s going to be a little bit different if you’re out in a rural area where you don’t have the opportunity for jobs unless you move into the city, or if you are the full-time caregiver for someone in your family.”
Cutting down on “waste, fraud and abuse”
Republicans argue that more frequent eligibility checks on Medicaid recipients will cut down significantly on “waste, fraud and abuse.” The bill requires states to check at least every six months whether adults covered under the Medicaid expansion are still eligible. States would also be required to take steps to obtain enrollees’ updated contact information and check a Social Security Administration database more frequently to determine whether any enrolled individuals have died. GOP senators who may be undecided on the bill have not yet indicated whether they object to this proposal.
Penalizing states that provide health benefits to undocumented migrants
The bill also includes a provision that would reduce federal funds to states that provide state-funded health care to undocumented immigrants. Though people who are in the U.S. illegally are not eligible to receive Medicaid coverage, 14 states and Washington, D.C., have expanded their state-funded health coverage to include children regardless of their immigration status, according to KFF, while seven states and D.C. cover some adults.
Under the Affordable Care Act, 40 states and D.C. have expanded Medicaid, enabling them to receive federal funding for 90% of the costs for low-income people receiving health care coverage under the expansion. The House bill would reduce the match rate to 80% for states providing health care to undocumented immigrants.
Banning Medicaid coverage for gender-affirming care
The House bill also prohibits federal Medicaid funding from covering gender transition services for children and adults, including surgeries, hormone therapy and puberty blockers. The bill initially blocked gender-affirming care for minors but was updated to include adults before its passage in the House.
Freezing provider taxes
States can boost federal Medicaid contributions to their states through what’s known as a provider tax, often levying taxes on health care providers, which raises the overall cost of a service and therefore increases the portion paid by the state. For instance, if the cost of a service is $1,000, and the state and federal government split is 50-50, the state might add a 5% provider tax that would bring the total cost of the service to $1,050. That would mean that the federal government would reimburse the state $525, rather than $500. The House measure aims to lower federal costs by freezing states’ provider taxes at current rates and prohibiting them from establishing new provider taxes.
Murkowski cited provider taxes as one possible cost-saving measure that’s “not going to hurt Alaskans.”
“It’s about $170 billion in savings that could be had if we were to eliminate that,” she told The Foraker Group. “To me, that’s a real savings.”
————————-
|
 Many people don’t realize how Medicaid works — through a unique partnership between the federal government and state agencies to provide health care for nearly 80 million people nationwide. Particularly in a changing policy environment, understanding the foundations of this collaboration is critical to strengthen Medicaid programs and policies. This episode of the Medicaid Leadership Exchange podcast explores the benefits and challenges of this collaboration, as well as opportunities to leverage this unique partnership to better serve Medicaid members. The episode features perspectives from two Medicaid leaders who have worked in both state and federal agencies:
- Calder Lynch, vice president, Medicaid regional president, Humana; former director, Center for Medicaid & CHIP Services, Centers for Medicare & Medicaid Services (CMS); and former director, Nebraska Medicaid
- Drew Wilson, director, Division of Medicaid and Medical Assistance, Delaware Department of Health and Social Services and former health insurance specialist, CMS
The episode is hosted by Mark Larson, former Vermont Medicaid director and senior vice president, Center for Health Care Strategies (CHCS), and Jami Snyder, former Arizona and Texas Medicaid director and president and CEO, JSN Strategies. The Medicaid Leadership Exchange podcast explores priority topics for Medicaid leaders. It is developed in partnership by the National Association of Medicaid Directors and CHCS through support from the Robert Wood Johnson Foundation.
|
|
|
