Conservatives pressure GOP leaders to reform Medicaid in budget reconciliation bill

Conservatives in Congress are pushing GOP leaders to reform Medicaid as part of the budget reconciliation bill that's being crafted.

"I think we should extend the tax relief for the American people, but I also think we should stop spending money we don't have and offering to continue to fund broken programs that are delivering bad healthcare outcomes for the American people, rather than reforming and making them better," Rep. Chip Roy, R-Texas, said during a media gathering on Capitol Hill.

Roy has described Medicaid as one of the biggest drivers of wasteful spending due to the amount of improper payments coupled with the Medicaid expansion that has taken place in 41 states.

"Today, the federal government covers roughly 75% of all Medicaid costs, up from its historic 60% share. That cost shift exceeds $100 billion annually," Roy wrote in a letter to his GOP colleagues on Thursday.

Medicaid spending examined

"Meanwhile, improper Medicaid payments have totaled more than $1.1 trillion over the last decade, driven by lax eligibility enforcement and fiscal gamesmanship," he added.

Improper payments for Medicaid in fiscal year 2024 were $31 billion. The number was $50 billion in fiscal year 2023. Improper payments are defined as payments made in error either for an incorrect amount or to an ineligible recipient. Total Medicaid spending was $880 billion in FY2023. 

In his letter, Roy cited the Congressional Budget Office projecting that the "baseline for Medicaid from 2025 to 2034 is $1.2 trillion higher than it was in 2021."

Roy said the Biden administration had "prevented states from removing ineligible enrollees for more than three years and discouraged proper redetermination practices."

He also said the Biden administration "enabled an explosion of money laundering schemes—such as provider taxes and intergovernmental transfers—that allow states to generate federal matching funds without contributing real dollars."

Characterizing changes as "benefit cuts"

Democrats have criticized the effort to make significant changes to Medicaid, such as rolling back the expansion that began after the passage of the Affordable Care Act in 2010, arguing that the GOP would be cutting benefits.

Similarly, some Republicans are not on board with changes that would lead to Medicaid spending cuts either. Rep. Jeff Hurd, R-Colo., and 11 other House Republicans wrote to Johnson in support of preserving Medicaid.

"So my district is Colorado's third congressional district and nearly one-in-three people in that district rely on Medicaid. When I talk about vulnerable populations from my perspective, I'm talking on preserving the original purpose of Medicaid, providing health care for low-income groups, people like children, seniors who are dual enrolled in Medicare, pregnant women, individuals with disabilities, and families who can't afford private insurance," Hurd said on Colorado Public Radio.

Hurd and the other Republicans indicated in their letter that they would back "targeted reforms" to Medicaid. 

An example of a targeted change, Hurd explained, would be "re-evaluating the continued federal subsidization of able-bodied working-age adults under the Affordable Care Act expansion."

Hurd also said Congress shouldn't allow the expansion of Medicaid to "crowd out the traditional priorities" like work requirements.

"I think we should incentivize people who are able to work, to work and to have jobs that allow them to support themselves and not need to rely on assistance from taxpayers," he said.

President Trump was asked Sunday on "Meet the Press" if he would veto a reconciliation bill that cuts Medicare.

"I would if they were cutting it, but they’re not cutting it. They’re looking at fraud, waste and abuse. And nobody minds that. If illegal immigrants are in the mix, if people that aren’t supposed to be there, people that are non-citizens are in the mix, nobody minds that," he said. "Waste, fraud and abuse. But we’re not cutting Medicaid, we’re not cutting Medicare, and we’re not cutting Social Security."