Donald Trump’s budget that is expected to be unveiled on Tuesday will include $800 billion in cuts to Medicaid — a move that underscores the President’s resolve to significantly downsize the federal program even as Republican lawmakers are clashing over the issue in Congress.
The $800 billion reduction, confirmed to CNN Sunday evening by a senior administration official, assumes that the GOP health care bill that the House passed earlier this month would become law, that official said.
The House legislation to dismantle the Affordable Care Act — President Barack Obama’s landmark health care law also known as Obamacare — would significantly curtail federal support for Medicaid.
Under that bill, in 2020, states that expanded the program would no longer receive enhanced funding to cover low-income adults, while states that did not expand previously would not be able to do so, starting immediately. Some 11 million adults have gained coverage under Medicaid expansion.
Also, the bill would reduce federal funding for the entire Medicaid program, which covers more than 70 million low-income children, adults, disabled Americans and the elderly. States would either receive a set amount of funding per enrollee, known as a per capita grant, or fixed funding in the form of a block grant.
Either option would limit federal responsibility, shifting that burden to the states. However, since states don’t have the money to make up the difference, they would likely either reduce eligibility, curtail benefits or cut provider payments. The block grant would be more restrictive since the funding level would not adjust for increases in enrollment, which often happens in bad economic times.
The GOP bill would slash federal support of Medicaid by 25% by 2026, compared to current law, according to the Congressional Budget Office.
What to do about Medicaid was a major flashpoint of the House GOP bill, with many Republican members expressing concerns about cutting a program that has provided insurance to so many of lower-income constituents. It has also provided treatment for Americans battling drug addiction, an issue of concern for many Republican governors and GOP representatives.
The issue has already emerged a sticking point in the Senate, where several Republican senators look poised to vehemently oppose major cuts to the program.
The Congressional Budget Office scored an earlier version of the GOP health care bill in March. It found that 14 million fewer people would enroll in the program by 2026.
The CBO is set to release Wednesday afternoon a new score of the revised legislation that House Republicans ultimately passed.