Medicare and Medicaid To Change Under Republican Proposals: What To Know

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Republican lawmakers have proposed a raft of cost-cutting measures that could limit access to Medicaid and Medicare.

Why It Matters

Funding cuts and regulatory changes could radically reduce Medicaid, the largest program providing medical and health-related services to low-income people, as well as Medicare, federal health insurance for people 65 or older, and some under 65 with certain disabilities or conditions.

What To Know

Republican members of Congress are working to pass a major reconciliation bill that would renew or expand key elements of the 2017 Tax Cuts and Jobs Act, a landmark piece of legislation from Donald Trump's first presidency. The TJCA, which lowered corporate, individual, and estate taxes, contains numerous provisions currently set to expire at the end of 2025. The Treasury Office of Tax Analysis estimates that extending these tax cuts could add up to $5 trillion.

In a bid to offset these expenses, House Budget Committee Republicans have identified federal spending programs as potential targets for cuts, including Medicaid and Medicare.

Ending Medicaid for Some Noncitizens

"Currently, many noncitizens who entered the country illegally are eligible for federal health care programs including advance premium tax credits and Medicaid," the memo reads. "This policy would remove specified categories of noncitizens from eligibility for federal health care programs," with an estimated $35 billion in savings projected over 10 years.

Work Requirements

GOP lawmakers have suggested introducing work requirements for Medicaid recipients. According to the memo, this approach aims to "restore the dignity of work" by requiring able-bodied adults without dependents to meet work requirements to qualify for Medicaid coverage.

By introducing the work requirements measure, lawmakers would effectively reduce enrollment in the health care program for low-income individuals. The budget memo says this will save an estimated $100 billion over the next decade.

There would be some exemptions, such as "pregnant women, primary caregivers of dependents, individuals with disabilities or health-related barriers to employment, and full-time students."

Limiting Subsidies

The plans outline restricting Affordable Care Act subsidies to only the "most needy Americans," which would reduce support for lower-income Americans who fall above specific poverty thresholds.

GOP lawmakers estimate this change could save $5 billion over the next decade.

What People Are Saying

Texas Republican Representative Chip Roy, a member of the Budget Committee, said earlier this month: "You need wholesale reform on the health care front, which can include undoing a lot of the damage being done by the ACA and Obamacare. Frankly, we could end up providing better service if we do it the right way."

Matt Salo, former executive director and founder of the National Association of Medicaid Directors, told KFF Health: "What we are going to see is an even bigger seismic shift in who Medicaid covers and how it operates. A lot of powerful entities—state governments, managed-care organizations, long-term care providers, and everyone under the sun who wants to do well by doing good—want to see Medicaid work efficiently and be adequately funded. And they will be highly motivated to push back on something they see as draconian cuts, because it could affect their business model."