House budget talks heat up over Medicaid cuts

Medicaid cuts emerged as an especially sensitive flash point Thursday during the first public debate over a House Republican plan to extend tax cuts and slash federal spending.

Republicans at a House Budget Committee markup insisted they only want to target waste, fraud and abuse in Medicaid, and defended themselves against Democratic assertions that GOP policies would hurt people and medical providers. Democrats said harm is inevitable if Republicans want the Energy and Commerce Committee, which has jurisdiction over Medicare and Medicaid, to find $880 billion in budget cuts over the next decade.

Related: House GOP eyes $880B in healthcare cuts

Illustrating the sensitivity of the charges and showing the potential pitfalls they face in being seen as taking healthcare away from people, Republicans insisted they are answering the call of voters who elected President Donald Trump, and that no such calamities would be forthcoming.

"We will right-size this bloated bureaucracy. We will root out the massive waste and fraud in the federal government," said Budget Committee Chair Jodey Arrington (R-Texas). "What we learned from November's election, and I think what is abundantly clear to all, the American people want their country back. They want normal. They want to return to common sense."

Arrington insisted there is none of the cruelty in the budget that Democrats see when they point to the $880 billion Republicans want cut. Voters care about their neighbors, but don't want to see the system abused, he said.

"They want to help their fellow Americans in their time of need, but they expect their fellow Americans, when they're able, to help themselves," Arrington said.

Among the changes Republicans are considering are block-granting Medicaid funding to states and instituting work requirements for beneficiaries.

House and Senate GOP leaders are gearing up for a major push to extend tax policies from Tax Cuts and Jobs Act of 2017, which Trump enacted during his first term and which are his top priority this year. The nonpartisan Congressional Budget Office projects that renewing these tax cuts for corporations and wealthy households would increase the budget deficit by $4.6 trillion over 10 years.

As such, congressional Republicans are scouring federal programs for spending cuts, and attempting to fulfill the party's decades-long campaign to shrink the social safety net.

Congress is utilizing an expedited process known as budget reconciliation that allows bills altering taxes and spending to pass the Senate on simple majority votes without being subjected to filibusters that require 60 votes to end. Republicans have a 218-215 majority in the House and a 53-47 advantage in the Senate.

On Thursday, the Budget Committee considered a resolution that instructs other committees to assemble $1.7 trillion in spending reductions, or 37% of what the tax cuts will cost. More than half would come from the Energy and Commerce Committee. Trump has promised not to enact Medicare cuts, leaving Medicaid as the most obvious source of savings.

Nevertheless, some Republicans went so far as to deny the Energy and Commerce Committee will propose healthcare cuts.

"The first thing is, they're going to make a bunch of claims about what's in this bill, about what's being cut, what's being cut from this Medicaid program or this welfare program," said Rep. Blake Moore (R-Utah). "This is a framework of dollars about where we're going. It's just a balance sheet. It does not have specifics about programmatic changes."

Another, Rep. Andrew Clyde (R-Ga.), pointed out that the programs the Energy and Commerce Committee oversees are projected to spend about $20 trillion over 10 years, suggesting that even though much of that is for health programs, there is plenty of room to find $880 billion.

Yet Clyde identified Medicaid spending as worth cutting, citing nonpartisan Government Accountability Office estimates of $50 billion a year in improper payments. Clyde also suggested the federal government should crack down on state provider taxes to save more than $300 billion. Many states supplement their share of Medicaid expenses by taxing providers, which has the effect of increasing federal spending.

Rep. Buddy Carter (R-Ga.), who chairs the Energy and Commerce Committee's Health Subcommittee, said savings would be achieved by targeting providers and abuse, and insisted people would not suffer.

"We will not be kicking people off of Medicaid. That is not what is going to happen," Carter said. "What we will succeed in doing is making sure that we stabilize, making sure that we secure, making sure that we strengthen Medicaid by eliminating waste, fraud and abuse that is going to a lot of providers."

Previous GOP attempts to scale back Medicaid, most notably the failed 2017 effort to repeal the Affordable Care Act of 2010, led to widespread backlash from the healthcare sector and the public at large. Republicans lost the House majority in the 2018 midterm elections.

Democrats, aware that hospitals, doctors, health insurance companies and the public react poorly to huge healthcare cuts — and are already criticizing the GOP plans — highlighted the impossibility of extracting major savings without people losing coverage.

"We are letting people know what the real consequences will be. There will be real pain," said Budget Committee ranking member Brendan Boyle (D-Pa.). "You don't get $880 billion, as well as the other cuts that are in here, by just saying, 'Oh, it's waste, fraud and abuse.'"

"Just be genuine. Say 'Look, these are going to be the consequences,'" Boyle said. "Just acknowledge that you don't think the government should be in the Medicaid business, you don't thing the government should be in the Affordable Care Act business. Because that, in the end, is really what we're talking about."

The Budget Committee is expected to approve the resolution Thursday evening. House Speaker Mike Johnson (R-La.) wants committees to finish their work quickly so the House can pass a final bill in May.