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PAYGO Politics President Donald Trump and Republicans said they would not cut Medicare, but the budget reconciliation could very well do that. Since the bill actually increases the deficit in future years, what is known as PAYGO sequestration kicks in to address the increase. Medicare is one program that can be cut under the law to a cap of 4%. On an earlier version of the bill, the Congressional Budget Office (CBO) said about $500 billion in cuts could be triggered beginning in 2026. PAYGO can be overruled but the Senate Democrats would have to join Republicans to overrule PAYGO by 60 votes. In this political world, will that happen this time as it has in the past? Will Democrats blame Republicans for passing the budget bill and not overrule or would that then put the blame on Democrats? See my blog this week for all the details of the

A Second Budget Bill Coming? Capitol Hill was abuzz today when the budget chairs of each house signaled that they both would like to see a second bill. While budget reconciliation rules allow for only one bill per year, the GOP had FFY 2025 and FFY 2026 budget years they could use for the process. And technically, after October 1, 2025, FFY 2027’s budget could also be acted on with a budget reconciliation bill. Budget Chairs Mike Crapo, R-ID, and Rep. Jodey Arrington, R-TX, each confirmed a desire for a second bill later this year but did not specify what might be included. Separately, Ron Johnson, R-WI, said that he has a commitment from the White House and Senate GOP leadership to get another chance to repeal part of the Affordable Care Act’s (ACA) expansion of Medicaid. Johnson’s proposal would end the 90 percent federal cost-share at the end of

Good News, Bad News On Drug Tariffs President Trump said Tuesday that he could levy up to 200 percent tariffs on pharmaceutical products imported into the U.S. soon. “If they have to bring the pharmaceuticals into the country, the drugs and other things into the country, they’re going to be tariffed at a very, very high rate, like 200 percent,” Trump said during a Cabinet meeting. That is the bad news. In good news, Trump said any tariffs would not take effect immediately. “We’re going to give people about a year, year and a half, to come in, and after that, they’re going to be tariffed,” Trump said. America imports the majority of its generic drugs from abroad and Trump wants this production onshored for national security reasons. Many brand drugs are also imported. Levies on drugs would increase already steep spending trends in healthcare. #tariffs #drugpricing https://thehill.com/homenews/administration/5390505-trump-200-percent-tariffs-pharma-imports Employer Coverage Changes Not

Gearing Up For 2026 Election and Medicaid Interesting The Hill article on Medicaid being a huge election 2026 issue. Democrats will try to argue that the $1 trillion in cuts in the budget reconciliation bill will devastate coverage and providers, especially rural ones. Republicans will argue they are attacking fraud, waste, abuse, and improper enrollment. As the article notes, while many policy changes will not  be in effect yet, in prior midyear cycles issues still resonated. See my recap of what is in the budget reconciliation bill: https://www.healthcarelabyrinth.com/saga-over-big-beautiful-bill-has-passed-for-good-or-bad/ In other news, another study details impacts of healthcare cuts on providers throughout the nation. As well, Molina Healthcare released preliminary results from its second-quarter financials and is bracing for elevated medical costs. Centene pulled its earnings forecast earlier. Molina sees ongoing financial troubles in its Affordable Care Act (ACA) Exchange, Medicaid, and Medicare Advantage lines of business. The budget reconciliation bill

Big Beautiful Bill Signed President Donald Trump signed Republicans’ One Big Beautiful Bill and touted it as a landmark major tax and domestic policy bill. The bill extends tax reductions ready to expire and enacts new ones. At the same time, it institutes massive cuts to Medicaid that could remove millions of people from Medicaid and the Exchanges. The bill was months in the making and Donald Trump is being given considerable credit for its passage. Whatever you think of the bill itself, its passage can be described as a political master stroke given the tight vote count for the GOP in each chamber of Congress. Trump stayed engaged with lawmakers on each vote – the initial House draft, the Senate recrafted one, and the House adoption of the Senate version. He is credited with creating a full course press to pass the bill, including a mixture of cajoling, education,

House Passes Big Beautiful Bill; On To The President After almost collapsing overnight Wednesday in the House, the Big Beautiful Bill gained just enough votes to pass during the afternoon Thursday. The House had to adopt the Senate version to meet the deadline of July 4. Both moderates and conservatives in the House GOP caucus were highly critical of the Senate version, but all but two relented and voted for the budget reconciliation measure. Conservative Thomas Massie, R-KY, and moderate Brian Fitzpatrick, R-PA, were the only GOPers to vote against it. The bill passed 218-214 and the bill will be signed by President Trump tomorrow, Independence Day. I had always argued there was an inevitability associated with passage of the bill, whatever healthcare cuts are in or the impact on the deficit. The GOP sees the Big Beautiful Bill as a seminal event for the party and a movement. But

Budget Bill Stalled In House The House is in flux right now as Speaker Mike Johnson, R-LA, and President Donald Trump are seeking to cajole moderates and conservatives in the GOP caucus to support the Senate version of the Big Beautiful Bill. Conservatives criticize the massive additional overall deficit and debt the Senate bill generates against the House version. They issued a memo criticizing both the Speaker and Senate Majority Leader John Thune, R-SD, for moving away from the House framework. At the same time, moderates are criticizing the fact that Medicaid cuts are actually higher than in the House bill, especially as it relates to greater limitations on the provider tax and its phasedown to 3%. Trump and Johnson are having some impact. Between six and 20 GOP votes might have been in the “no” column today, but some are now coming around and saying they will vote for

Senate Passes One Big Beautiful Bill It was another wild all-nighter for the Senate GOP caucus Monday in its efforts to pass the One Big Beautiful Bill. But early afternoon Tuesday, the bill was finally passed and now goes back to the House. A conservative amendment to lower the federal matching percentage in expansion states did not have enough votes to pass. But in the end the conservatives except Rand Paul voted for the measure. Despite helping get a rural hospital fund to $50 billion, moderate Susan Collins voted against the bill along with Thom Tillis. All eyes Monday were on moderate Lisa Murkowski. She won some SNAP nutrition and Medicaid funding concessions in the bill for Alaska and, with the rural hospital fund increase, voted yes. That gave the bill 50 votes, allowing Vice President JD Vance to cast the tie-breaking vote for approval. Healthcare providers and health plans

Senate Acting On Budget Bill The Senate began debating the budget reconciliation bill and the process will go late into Monday at a minimum before any final vote. A procedural vote to open debate passed on a 51-49 vote Saturday, with conservative Rand Paul, R-KY, and pragmatic conservative Thom Tillis, R-NC, voting “no.” Paul likely will never support the bill due to debt concerns. The debt limit is actually hiked $5 trillion vs. $4 trillion earlier. Tillis opposes the deep Medicaid reductions. But the bill’s passage is by no means certain right now. A lot has to happen before final passage. The bill went through a wide-ranging debate over the weekend and a Vote-a-Rama (unlimited amendment offerings) started on Monday. Four other conservatives – Ron Johnson, R-WI, Rick Scott, R-FL, Mike Lee, R-UT, and Cynthia Lummis, R-WY – only voted “yes” on the bill after commitments from leaders that a

Victory For Preventive Services As expected, the Supreme Court ruled 6-3 in favor of allowing preventive services to continue under the Affordable Care Act (ACA). The majority was a mix of conservatives and liberals. The high court determined that members of the U.S. Preventive Services Task Force, which makes recommendations for coverage requirements under the ACA, are selected within the bounds of the Constitution. The court agreed that the task force is appointed by an executive appointee and could be replaced. The religious arguments on the provision of certain services were largely sidelined. Additional articles: https://www.fiercehealthcare.com/regulatory/scotus-upholds-aca-preventive-services-task-force-6-3-ruling and https://www.healthcaredive.com/news/supreme-court-aca-preventive-care-mandate-decision-braidwood-kennedy/751806/ and https://www.medpagetoday.com/primarycare/preventivecare/116288 and https://www.modernhealthcare.com/politics-regulation/mh-aca-preventive-care-ruling-reactions/ and https://thehill.com/homenews/ap/ap-business/ap-supreme-court-preserves-key-part-of-obamacare-coverage-requirements/?amp_gsa=1&amp_js_v=a9&usqp=mq331AQIUAKwASCAAgM%253D&tbref=hp (Some articles may require a subscription.) #prevention #preventiveservices #aca #obamacare https://www.modernhealthcare.com/politics-regulation/mh-supreme-court-aca-preventive-coverage Senate Schedules A Saturday Budget Vote, But Outcome Uncertain Changes to the Senate version of the budget reconciliation bill is due out Friday night and a vote to proceed on the bill is set for Saturday,