GOP fiscal hawks let their party’s tax and spending package advance toward a floor vote. But they’re threatening to tank President Donald Trump’s “big, beautiful bill” if they don’t see even more spending cuts and conservative policy changes.

Catch up: Republican hard-liners who sank the Budget Committee’s initial vote on the vehicle for Trump’s domestic agenda last Friday allowed the measure to proceed late Sunday after securing promises from GOP leaders that changes would be made before the legislation hits the House floor. According to Rep. Ralph Norman, those changes could include speeding up enforcement of Medicaid work requirements, nixing green-energy tax perks enacted during the Biden administration and revoking Medicaid benefits from undocumented immigrants, our Jennifer Scholtes and Meredith Lee Hill report.Speaker Mike Johnson huddled privately with the holdouts — Norman and Reps. Chip Roy, Josh Brecheen and Andrew Clyde — just before the Budget panel reconvened Sunday night. Emerging from the confab, he described agreed-upon changes to reporters as “minor modifications.” The four conservatives went on to vote “present” rather than “no,” allowing the package to move forward. But the eleventh-hour tweaks are likely to have massive implications for already-wary moderates (more on that below).

The hard-liner headache isn’t going away. Roy and Norman also are on Rules, which represents the last hurdle the bill needs to clear to get a floor vote (a notice that went out after midnight says the panel will meet on the measure at 1 a.m. Wednesday). Norman on Sunday night said GOP leaders put their latest concessions in writing. Yet negotiations are ongoing — Budget Chair Jodey Arrington predicted Sunday that talks “will continue on into the week and I suspect right up until we put this big, beautiful bill on the floor of the House” — and conservatives are far from fully satisfied.

“The bill does not yet meet the moment,” Roy said in a post on X, asking for a complete repeal of Biden-era clean-energy subsidies and deeper federal spending cuts to Medicaid. The House Freedom Caucus released a similar statement drawing its red lines.

Those are going to be tough concessions to make without backlash from the moderate Republicans in the conference, some of whom are pushing to protect more of the clean-energy tax provisions currently benefiting their districts and states.

Norman, Roy, Brecheen and Clyde were enraged when GOP leaders told them the conference did not have the votes for a full repeal of the Democrats’ 2022 climate law, Jennifer and Meredith write. One option GOP leaders and White House officials are discussing with the hard-liners is moving up the sunset date for certain green credits beyond what is now included in the megabill.

The Medicaid issue is even trickier. Hard-liners appear to be close to notching one big win with moving up the work requirements from 2029 to 2027. Yet as hard-liners make their push for more Medicaid changes, moderates are warning leaders to apply a lighter touch. Johnson is meeting with the Main Street Caucus Monday night, including with a group of moderates who requested to meet with the speaker over Medicaid, food aid and pension concerns in the bill.

Trump has been reluctant to make any moves that could be seen as cutting Medicaid benefits. But as talks lingered through the weekend, one thing became clear: “In the end, the president is gonna have to weigh in on where he stands” on the matter, one person involved in negotiations told Jennifer and Meredith.

Speaking of the president: Keep an eye out for any White House meetings this week. Johnson’s leadership circle has debated at what point to ask the White House to invite the various factions of the conference to the Oval Office and get Trump involved.

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(Gov’s Office to state advocates,  5/17)“…Writing to share the State’s preliminary estimates of the combined impacts of some of the healthcare provisions already passed out of House Ways & Means and Energy & Commerce committees for the budget reconciliation bill. In total, these two provisions equate to an over $11 billion loss annually for New Yorkers and our healthcare economy. Changes of this scale will result in drastic changes to the scope of services, eligibility, and financing of Medicaid and the Essential Plan moving forward which will curtail healthcare for millions of New Yorkers and jeopardize the financial stability of New York’s hospitals. In addition, the work requirements and increased verification/eligibility requirements will add significantly to the administrative burden of the program, with an anticipated $500 million in state costs to comply. We anticipate seeing additional coverage losses as individuals struggle to meet the added administrative burden. 

Key takeaways:

Given the magnitude of the cuts to federal funding, it is impossible for the State to absorb the impacts. Drastic changes to eligibility, financing and benefits will be required. More than half of the Essential Plan funding would be slashed, threatening the future of the program. Up to 1.2 million New Yorkers could lose Essential Plan or Medicaid coverage—placing enormous strain on the health care system and triggering widespread impacts across local economies.The bill as passed out of Ways & Means contains language that would devastate the state’s Essential Plan program by reducing its funding by more than 50%.

The Ways & Means language eliminates the ability of certain lawfully present immigrants to access federal premium tax credits that effectively underwrite the State’s Essential Plan. Funding for New York State’s Essential Plan, which offers affordable coverage to over 1.6 million New Yorkers across all counties, is calculated using those premium tax credits. In turn, those federal dollars fund the Essential Plan and are used to reimburse providers for care. Hospitals with already strained budgets will feel the burden in the form of uncompensated care. This will disproportionately impact and destabilize the safety-net further. Despite any federal shifts, New York State is still constitutionally required to provide healthcare coverage for much of this population. To comply with the state constitution, these individuals would move to state-funded Medicaid, with an estimated cost to the State of $2.7 billion annually. Under the New York State Constitution, much of the lost Essential Plan coverage burden would shift to fully state-funded Medicaid.

The State would then be penalized with a lower federal match for complying with our constitutional requirements of providing coverage for this population.

This provision would lead to an additional penalty of $1B annually, thus compounding the financial losses further. The combined impact of these select W&M and E&C provisions would essentially end New York State’s Essential Plan.

Approximately 506,000 individuals will lose their federally-funded Essential Plan coverage. The EP program relies on tax credits from the above population to fund the EP for the remaining 1.1 million enrollees without employer-based insurance.This results in losses of over $7.5 billion in federal Essential Plan funding annually, representing more than half of the EP’s annual budget. A funding loss of this size will have a significant impact on coverage for all enrollees, and risks destabilizing the market overall. 

Critically, this $7.5 billion disappears from our healthcare system and will result in further State expenditures of $2.7 billion. Over $1.3 billion of these losses will be felt by our hospitals in the form of uncompensated care increases and lower reimbursement levels, which will result in job loss and other negative impacts to local economies.These hospital losses will be compounded by the state limitations on financing Medicaid, such as a moratorium on provider taxes and limiting state-directed payments,  contained in the E&C provisions…”