House Minority Leader Hakeem Jeffries warned Friday that children, families, seniors and everyday Americans with disabilities will be “devastated” after House Republicans this week “passed the budget resolution that sets in motion the largest Medicaid cut in American history.”
“Children will be devastated in the city of New York and beyond. Families will be devastated. Seniors will be devastated. Everyday Americans with disabilities will be devastated,” the New York Democrat said. “Hospitals will potentially close here in New York state, in rural America and across the country. And nursing homes will certainly be shut down.
“Every single House Democrat from New York City, from New York State and across the country oppose this reckless Republican budget, and we will continue to do so as long as the health care of the American people is being targeted, as long as nutritional assistance for children and families is being targeted by the extreme MAGA Republicans,” Jeffries added.
Jeffries spoke Friday as Republicans in Congress searching for a way around the $880 billion budget shortfall needed to be covered in order to extend President Donald Trump’s tax cuts are considering changing the way Medicaid is funded, according to Politico.
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As it stands, states must contribute their own matching funds to qualify for federal Medicaid dollars, but Republicans are weighing whether to prevent states from taxing insurers and health care providers as a way to raise that cash, a Politico report said Wednesday. Doing so would leave states with a $612 billion hole in their budgets over the next 10 years, the report said.
GOP leaders argue that states are inflating Medicaid costs because they are kicking back the taxes to those sources through higher payment rates, the report added.
“States and providers scheme so that the provider gets an enormous flow of federal dollars with no state cost exposure,” Brian Blase of the Paragon Health Institute think tank told the outlet.
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However, the American Hospital Association is calling on Congress to “reject changes to states’ use of provider taxes, which help fund their Medicaid programs,” as “Even small adjustments in the use of this financing source would result in negative consequences for Medicaid beneficiaries as well as the broader health care system.”
“States’ approaches to financing their share of the program are subject to federal rules and oversight, including limits on the amount of revenue that states can generate through provider taxes. Congress is contemplating further restrictions on states’ ability to finance their share of Medicaid spending through such taxes,” it said earlier this month.
“Most states would be unable to close the financing gap created by further limiting states’ ability to tax providers,” it warned. “States would need to make significant cuts to Medicaid to balance their budgets, including reducing eligibility, eliminating or limiting benefits, and reducing already low payment rates for providers.”
“States can use various sources to finance the non-federal share and would look to other sources if Congress limited their ability to use provider taxes,” it also said. “This means that some states would have to consider increasing other forms of taxes, including income and sales tax, levied on all state residents.”
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