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Budget Reconciliation In Senate Still In Limbo

After going to bat for deeper healthcare cuts for conservatives, Senate Majority Leader John Thune, R-SD, is facing an uprising on the right and left. Three conservatives – Mike Lee, Rick Scott, and Ron Johnson, are threatening to be off the bill unless deeper cuts occur, including in healthcare. Rand Paul appears already against the bill due to a provision that increases the debt limit. This would sink the bill.

At the same time, at least three moderates or pragmatists – Lisa Murkowski, Josh Hawley, and Susan Collins – remain very concerned about the depth of certain cuts, especially provider tax restrictions.

Thune wants to vote on the bill next week.

Rural providers, particularly hospitals, continue to argue the bill jeopardizes their livelihoods and that hospitals in under-served areas could shutter.

An impasse over the state and local tax deduction threatens passage of the budget bill in the House even if it passes the upper chamber. The Senate put no increase in the bill, while House moderates have demanded a $40,000 cap, up from $10,000. They say that is what they can live with.

In other news, the Trump administration finalized an Exchange integrity bill that removes special enrollment periods, shortens the open enrollment period, and strengthens eligibility requirements. The change is expected to mean 900,000 people lose enrollment. The administration argues the rule lowers premiums, but insurance regulators are looking at huge rate hikes for consumers due to the likely expiration of the enhanced premium subsidies and cost increases.

As well, the Senate parliamentarian said today that certain portions of the House-passed bill did not meet Byrd rules in the Senate, which would mean the bill as is could not pass on a majority vote.  These provisions will most likely be cut as the GOP is not expected to overrule the parliamentarian on a majority vote. The struck provisions have little or no impact on the healthcare reductions, but the provision to have states take on some nutrition program costs has been tagged as violating Byrd rules.

Additional articles: https://thehill.com/homenews/senate/5360488-parliamentarian-rules-bill-trump-agenda/ and https://thehill.com/homenews/house/5360071-impasse-over-salt-cap-deepens-as-house-moderates-stand-firm/?tbref=hp and https://www.modernhealthcare.com/politics-regulation/mh-one-big-beautlfil-bill-rural-healthcare/ and https://www.cms.gov/newsroom/press-releases/cms-finalizes-major-rule-lower-individual-health-insurance-premiums-americans and https://www.cms.gov/newsroom/fact-sheets/2025-marketplace-integrity-and-affordability-final-rule

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#budgetreconciliation #congress #trump #spending #medicaid #exchanges #hospitals #coverage

https://thehill.com/homenews/senate/5360058-conservatives-demand-deeper-spending-cuts

Opposition To Healthcare Cuts In Budget Bill

All of healthcare is lining up against the cuts to healthcare in the budget reconciliation bill. A new study from the Urban Institute and Robert Wood Johnson (RWJ) Foundation breaks down how providers (hospitals, physicians, and drugs) are impacted in each state by the reductions to Medicaid and the Exchanges. Over the next decade, the bill would decrease spending by $321 billion to hospitals, $81 billion to physicians and $191 billion for drugs. Spending for other healthcare services would decline by $205 billion.

If the Exchange premium tax credits expire, spending would decline by an additional $262 billion — hospitals an additional $103 billion cut, physicians an additional $39 billion cut, and drugs an additional $50 billion cut. Spending on other healthcare services would drop an additional $70 billion.

Now, I have little doubt on the math of what Urban and RWJ did. If you cut a trillion out of healthcare over ten years, it is technically true that it flows through the system down to providers rendering care. What the researchers miss is that we do need real price reform in the system. Done right, money could be taken out of the system without impacting coverage. Those hospitals at risk could even be stabilized under the new paradigm.

In other news, health plan trade and lobbying group AHIP said it will mount an opposition effort to the bill in concert with other healthcare groups. It wants the budget bill reductions reversed and premium credit enhancements extended.

AHIP and health insurers are worried about the massive financial fallout from the Exchange and Medicaid cuts as well as the impact of the recent risk adjustment data validation (RADV) audit announcement for Medicare Advantage (MA).

Additional article: https://www.fiercehealthcare.com/payers/ahip-2025-insurer-coalition-vows-fight-trump-budget-bill-final-hour

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#budgetreconciliation #congress #trump #medicare #exchanges #medicareadvantage #coverage #healthplans #providers

https://www.modernhealthcare.com/latest-news/mh-one-big-beautiful-bill-cuts-states/

Budget Reconciliation Bill Flounders

Senate Majority Leader John Thune, who won his position with backing from prominent conservatives, threw his weight behind budget-cutters in the reframing in the Senate of the House bill. But the move seems to have backfired on him.

He has two conservative holdouts on the bill. He also has an uprising from moderates and pragmatic conservatives due to the Medicaid reductions, which are even deeper than the House had included. Thune essentially ignored a fundamental part of his caucus.

The moderates are worried about impacts on states and providers as well as what will happen to the uninsured rate. At least three moderates or pragmatic conservatives – Josh Hawley, Susan Collins, and Lisa Murkowski – have been vocal on the cuts and expressed doubts about voting for the bill. But there are still others that could vote against them due to the Medicaid cuts. Right now, the unveiled bill likely does not have enough votes to pass.

What’s more, there is an uprising in the House over the Senate version, with conservatives decrying certain changes and moderates up in arms about the fact that the Senate refuses to increase the state and local tax (SALT) deductions.

Strap in for a long rollercoaster ride.

In addition to adding to work requirements for some and furthering limitations on provider taxes, the bill does not include the Affordable Care Act (ACA) ICHRA/HSA insurance-funding expansion provisions or Exchange program integrity provisions. Further, it does not include a physician rate fix in Medicare.

In other news, the Commonwealth Fund released an analysis of the benefits of coverage expansion and found that the uninsured rate for working adults fell from over 20% in 2013 to 11% in 2023. The reconciliation bill could add 16M to the ranks of the uninsured.

As well, healthcare policy group KFF finds that 22 states would have to amend their provider taxes due to the Senate limitations.

Additional articles: https://thehill.com/homenews/senate/5355927-thune-senate-medita-cuts/ and https://www.politico.com/news/2025/06/17/hospitals-senate-medicaid-megabill-taxes-00410769 and https://thehill.com/policy/healthcare/5355932-senate-medicaid-cuts-concern/?tbref=hp and https://www.healthcaredive.com/news/uninsured-rate-falls-across-states-federal-policies-medicaid-cuts-commonwealth-fund/750994/ and https://www.kff.org/policy-watch/which-states-might-have-to-reduce-provider-taxes-under-the-senate-reconciliation-bill/

#budgetreconciliation #congress #trump #medicaid #medicare #obamacare #aca #exchanges #coverage

https://thehill.com/homenews/house/5355954-gop-bill-opposition-house-medicaid-salt/?tbref=hp

— Marc S. Ryan

More Senate Budget News

The Congressional Budget Office (CBO) reaffirmed that the One Big Beautiful reconciliation bill will cost the healthcare sector a $1 trillion reduction over ten years. The Senate bill adds to limitations in the House bill on provider taxes (phasing them down and capping them to 3.5% over time for expansion states) and slightly tightens eligibility further. It also cuts certain existing state-directed payments to hospitals where the House just limited future payments.

Healthcare policy group has good summaries comparing the Senate and House versions for Medicaid and Affordable Care Act (ACA) cuts.

Additional articles: https://thehill.com/homenews/ap/ap-business/ap-trump-tax-bill-would-widen-deficits-by-2-8t-after-factoring-in-economic-impacts-cbo-says/?tbref=hp and https://thehill.com/homenews/senate/5353963-senate-medicaid-taxes-green-energy/ and https://www.kff.org/tracking-the-medicaid-provisions-in-the-2025-budget-bill/ and https://www.kff.org/tracking-the-affordable-care-act-provisions-in-the-2025-budget-bill/

(Article may require a subscription.)

#budgetreconciliation #congress #trump #spending #medicaid #coverage

https://www.modernhealthcare.com/politics-regulation/mh-gop-tax-plan-cost-cbo

Senate Reconciliation Bill Sets Up Showdown

The Senate version of the House-passed budget reconciliation bill has been unveiled and will create a showdown within the Senate and eventually with the House.

The measure preserves the House reductions to Medicaid but goes further. Beginning in 2027, the legislation would lower healthcare provider taxes to 3.5% (from 6%) in states that chose to expand Medicaid. It also expands those who would be required to work as a condition of Medicaid eligibility. The Senate version says adults with dependent children older than 14 will also have to prove they work, attend school, or perform community service for 80 hours a month. The House-passed version would exempt all adults with dependent children.

A number of moderates and pragmatic conservatives could be off the bill, with Sen. Josh Hawley, R-MO, and Sen. Susan Collins, R-ME, already speaking out. Hawley dislikes the provider tax changes as well as cost-sharing on certain enrollees. At the same time, at least two conservatives appear to be signaling their opposition – Sen. Rand Paul, R-KY, and Sen. Ron Johnson, R-WI. Other conservatives also signaled their reservations earlier. The Senate GOP can afford to lose just three votes.

Thus far, no reductions to Medicare have been included in the draft. Further, the Senate bill rejects the increase in the state and local tax (SALT) deductions to $40,000 and keeps it at $10,000 a year. House moderates would not vote for a bill that does not considerably increase the SALT cap.

In other news, a study published in the Annals of Internal Medicine says the House reductions to Medicaid is projected to cause 16,642 premature deaths among adults each year as Americans lose coverage.

As well, Democrats have introduced new legislation that would establish a “Part E” for Medicare, which would allow people to opt into the program. The new Part E would supposedly sustain itself through premiums. But it would be costly as the bill makes subsidies available through the Affordable Care Act (ACA) plans applicable to Part E coverage as well.

Additional articles: https://www.beckershospitalreview.com/quality/patient-safety-outcomes/medicaid-cuts-will-cause-16500-deaths-annually-study/ and https://www.fiercehealthcare.com/regulatory/democrats-introduce-bill-establish-medicare-part-e-public-option and https://thehill.com/homenews/senate/5353226-senate-medicaid-house-bill/

#budgetreconciliation #spending #medicaid #medicare #coverage #trump #congress #aca #obamacare #exchanges

https://thehill.com/homenews/senate/5352650-senate-republicans-trump-agenda-taxes-medicaid-green-energy

Democrats Propose Bills To Defend Medicaid

Democratic senators have proposed as many as 13 bills regarding Medicaid as the GOP continues its debate over changes to the budget reconciliation bill cuts to the low-income healthcare program. Some of the bills tackle fraud, waste, and abuse (FWA), while others protect expansion of coverage and insulate providers.

#budgetreconciliation #medicaid #trump #congress #coverage

https://www.fiercehealthcare.com/regulatory/democrats-make-pitch-medicaid-improvements-big-beautiful-bill-debate-heats

Medicare Advantage Abuses in Focus

A big day for coverage involving abuses in Medicare Advantage (MA).

First, Scan CEO Sachin Jain has a good Health Affairs Forefront blog on MA enrollment issues. Jain recounts the fact that there are behind-the-scenes compensation schemes between some large MA plans and brokers and marketing organizations that lead to steerage of enrollees into plans, often when it is not in their best interest. He notes enrollment in low-rated plans is a problem.

The Department of Justice filed a complaint against certain brokers and MA plans, alleging plans paid hundreds of millions of dollars in illegal kickbacks to brokers in exchange for enrollments into the plans’ products.

Jain proposes a change in how compensation is made for enrollment by favoring high-performing plans and perhaps making compensation is budget neutral.

Second, healthcare policy group KFF posted an issue brief regarding expected Star bonus payments in 2025. It says federal spending on MA bonus payments will total at least $12.7 billion in 2025, similar to spending in 2023, and more than four times higher than in 2015. While Star ratings have dropped, aggregate payments remain high due to enrollment increases.

Third, these bonuses help fund supplemental benefit offerings and MedPAC, the Medicare congressional policy arm, has published a report on such benefits. It finds spending on supplemental benefits has grown significantly over the past several years. MA plans will receive about $86 billion in rebates to provide supplemental benefits to enrollees. This is about 17% of total payouts in the program, or about $2,530 per person. Rebates in 2018 were $21 billion.

MedPAC notes that there is very little transparency in how these rebates are spent, especially with non-Medicare supplemental benefits. Reforms like mandatory submission of supplemental benefits via encounter data and member education have gone in force.

Expect all three of these areas to see Capitol Hill attention this and next year.

(Some articles may require a subscription.)

Additional articles: https://www.healthaffairs.org/content/forefront/changing-broker-incentives-medicare-advantage and https://www.kff.org/medicare/issue-brief/medicare-advantage-quality-bonus-payments/

#medicareadvantage #star #quality #marketing #fwa #supplementalbenefits

https://www.fiercehealthcare.com/regulatory/medpac-look-payments-ma-plans-supplemental-benefits

Public Supports Trump Drug Pricing Plan

A survey commissioned by the Pharmaceutical Reform Alliance and conducted by National Research Inc. finds that a majority of voters are in favor of lawmakers and candidates who they believe will take on Big Pharma price-gouging. Most say they support President Trump’s most-favored-nation drug pricing policy, where prices in the U.S. are set based on the lowest price in other developed nations.

#drugpricing #mfn #irp #trump

https://thehill.com/homenews/5343025-survey-voters-big-pharma-most-favored-nation

Senate Now Zeroing In On Medicare Advantage

The Senate appears to be zeroing in on Medicare Advantage (MA) overpayments for the budget reconciliation bill to achieve greater savings and perhaps reduce Medicaid cuts. MA plans and lobbies are lining up to oppose it, saying the reductions will impact enrollees. Sen. Bill Casidy, R-LA and Chairman of the HELP Committee, is one GOP senator examining it, which has bipartisan support (not that Democrats will vote for the bill).

Exactly what would be included is open. One report says the provision would save $100 billion over the 10-year horizon and would limit the ability to include old or unrelated medical conditions in the cost of care. Another proposal would save as much as $275 billion over 10 years. Very high estimates suggest total overpayments from risk adjustments are $43 billion annually (although I have great doubt about that number).

The Centers for Medicare and Medicaid Services (CMS) recently announced 100% audits of risk adjustment in MA. UnitedHealthcare and Humana recently backed partial reform related to diagnoses only tied to health risk assessments from home visits as well as from manual chart reviews. Moderates and pragmatic conservatives such as Sen. Josh Hawley, R-MO, are worried about both Medicaid and Medicare cuts.

In other news, the Health and Human Services’ Office of Inspector General (HHS OIG) announced the results of a risk adjustment audit and found that Coventry Health and Life Insurance Co., an Aetna subsidiary, received an estimated $6.9 million in Medicare Advantage overpayments. This was based on samples from 2018 and 2019. HHS OIG identified $752,587 of overpayments in its sample. Extrapolating from the sample, OIG estimated Coventry received $6.9 million in overpayments. 

As well, House conservatives have released a 10-page memo with proposals to go deeper in terms of Medicaid cuts in budget reconciliation, including restrictions on the Medicaid Federal Medical Assistance Percentage (FMAP) for expansion populations and further changes to provider taxes that generate state match dollars. These were rejected by House leaders.

Interestingly, the protests in Los Angeles over the White House’s deportation efforts could boost reconciliation efforts as tens of billions are included in the bill for border security and enforcement staff.

My view on including Medicare overpayments: far-reaching reforms of risk adjustment in the bill likely would continue the negative effects on MA benefits, coverage, and geography going into 2026. We already expect further retrenchment despite a better 2026 rate hike announcement. But it is hard to argue against carefully crafted reforms that get to ruling out abusive practices of a small number of plans that generate a huge windfall.

Additional articles: https://www.beckerspayer.com/policy-updates/insurers-oppose-medicare-advantage-changes-in-spending-bill/ and https://www.beckerspayer.com/payer/aetna-subsidiary-received-7m-in-medicare-advantage-overpayments-audit/ and https://thehill.com/homenews/house/5341366-house-conservatives-senate-gop-megabill/?tbref=hp and https://thehill.com/homenews/senate/5343114-trump-big-beautiful-bill-la-immigration-protests/ and https://www.healthaffairs.org/content/forefront/taking-stock-health-coverage-impacts-house-reconciliation-bill

(Some articles may require a subscription.)

#budgetreconciliation #trump #congress #spending #medicaid #coverage #medicareadvantage #overpayments #riskadjustment

https://thehill.com/homenews/senate/5341080-republicans-debate-fiscal-deficit-cuts/?tbref=hp

Preliminary Reports Show Major Exchange Premium Hikes

Exchange rate filings are beginning to filter in for 2026 and the news is not good. Many insurers are asking for double-digit rate increases in the individual and small group Exchange markets. This is occurring due to the likely expiration of enhanced premium tax credits and rising costs. Reports from various states say rate hikes could be as much as 23%. Average increases seem to be well into the teens.

#exchanges #aca #obamacare #coverage

https://www.beckerspayer.com/payer/payers-seek-double-digit-exchange-rate-hikes-for-2026