Washington
President Donald Trump and congressional Republicans describe the legislation as fulfilling their promise to repeal the Affordable Care Act, or Obamacare, but key provisions also are aimed at making progress on the GOP’s long-held goal of cutting entitlement spending.
The legislation would sharply break with pledges Trump made during the 2016 campaign to block reductions in Medicaid spending and to deliver tax cuts primarily to the middle class.
All together, it shows how long-term conservative goals of cutting taxes and entitlement spending have overtaken Trump’s agenda, as the bill faces critical votes in the Senate as soon as next week that could take it to the precipice of becoming law. Reducing taxes, Republicans argue, will boost the economy, and shrinking spending on programs such as Medicaid will slow the growth of the federal debt.
“When otherwise has this been done?” said Douglas Holtz-Eakin, a Republican and a former director of the Congressional Budget Office. “You can’t name any combination of tax cuts and entitlement reforms like this in one bill.”
“This is a historic enterprise, and it explains why the screaming coming out of the left is so fierce,” he added.
Republicans have been on a multi-decade quest to fundamentally alter Medicaid, which provides health benefits for low-income Americans and those with disabilities. Medicaid is run jointly by states and the federal government, but conservatives have long decried it as wasteful and bloated with spiraling costs.
The Senate bill would give states the option of changing Medicaid into a “block grant” program or putting firm caps on its spending based in part on how many people live in each state. Just as significant, the bill would arrest future Medicaid spending with tight controls on how much the program can grow.
Meanwhile, the legislation would leave in place reductions in spending for Medicare, the health insurance program for the elderly, that were part of the Affordable Care Act. Republicans previously slammed those cuts as robbing the program to pay for Obamacare.
The Senate bill also would deliver roughly $1 trillion in tax cuts over 10 years, including cuts to the rates wealthy Americans pay on investment income and to a levy charged to health insurance companies.
Democrats argue that the Republicans’ ideological goals will be fulfilled at the expense of millions of poor people who will lose access to health care — in some cases with life-or-death consequences.
The Affordable Care Act, which passed with support from only Democrats in 2010, increased access to Medicaid benefits by changing the eligibility threshold and providing more federal taxpayer dollars to cover new enrollees.
Since the law passed, many states — run by both Democrats and Republicans — have expanded their Medicaid programs to take advantage of the new federal support. The authors of the ACA had intended for all states to do so, but the Supreme Court ruled that the government could not compel states to participate in the expansion of the program.
The average number of people receiving benefits from Medicaid and a health care program for low-income children has risen 30 percent under the ACA, to 74.6 million people, according to the Kaiser Family Foundation. That represents roughly 23 percent of all Americans. By some measures, Medicaid covers more Americans than any other safety net program, larger than even Social Security or Medicare by total enrollment.