“It won’t be any consolation to struggling Americans that their hardship allows some rich buddy of Donald Trump’s to buy a bigger yacht,” said Sen. Ron Wyden.
Policy experts and Democratic lawmakers raised alarms this weekend following a leaked House Republican proposal that suggests plans for deep cuts to Medicaid, the vital health programme serving around 80 million Americans, including children, seniors, and individuals with disabilities.
The leaked document, reportedly from the House Budget Committee, outlines “spending reform options” aimed at financing new tax cuts for the wealthiest individuals and large corporations. Near the top of this controversial list is a proposal to shift Medicaid to a “per-capita cap” funding structure. Under this scheme, federal contributions would be capped on a per-beneficiary basis rather than covering a percentage of states’ overall costs.
Experts warn such a change would have devastating consequences. Edwin Park, a research professor at Georgetown University’s Centre for Children and Families, described it as a radical restructuring of Medicaid financing. “These funding caps are typically designed to fail to keep pace with expected growth in healthcare costs, resulting in deeper and deeper cuts over time,” Park wrote in a blog post. He also noted that unexpected events, such as a public health emergency or the introduction of costly new therapies, would exacerbate the funding shortfalls.
According to the leaked document, these changes could slash up to $918 billion from Medicaid over the next decade. The Centre on Budget and Policy Priorities has warned that such cuts would place significant strain on state budgets, forcing millions of vulnerable Americans to lose access to essential benefits and healthcare coverage.
The Republican proposal also includes plans to “equalise Medicaid payments for able-bodied adults,” a move widely interpreted as targeting Medicaid expansions introduced under the Affordable Care Act. Additionally, the GOP intends to push for Medicaid work requirements—a policy that has already caused chaos in states where it has been trialled.
Park argues that these requirements would compound the damage caused by funding cuts. “The onerous red tape associated with work requirements would take away coverage from tens of millions of low-income children, families, seniors, and people with disabilities who depend on Medicaid,” he said. “Moreover, because Medicaid accounts for over 56% of federal funding for state budgets in 2024, the financial burden shifted to states would likely force devastating cuts to other crucial services, including K-12 education.”
The leaked policy list details a broader Republican strategy to enact up to $5.7 trillion in spending cuts over the next decade. Of this, Medicaid cuts would constitute a staggering $2.3 trillion. Other targets include Temporary Assistance for Needy Families, federal nutrition assistance, clean energy funding, and major health regulations implemented under President Biden’s administration.
These measures are designed to bankroll another round of tax cuts championed by former President Donald Trump, which overwhelmingly benefit the wealthiest Americans and large corporations.
“This won’t lower costs for struggling Americans,” said Representative Mike Levin of California. “These cuts would only help bankroll Trump’s tax cuts for his billionaire friends and corporate interests.”
Senator Ron Wyden of Oregon, the ranking Democrat on the Senate Finance Committee, characterised the Republican proposals as a “class war against everyday families in America.” He said, “This list outlines a plan to increase child hunger, boot tens of millions off their health insurance, and lay off hundreds of thousands of clean energy workers to fund tax handouts for the wealthy.”
Wyden condemned the Republican strategy, calling it a betrayal of American families. “It won’t be any consolation to struggling Americans that their hardship allows some rich buddy of Donald Trump’s to buy a bigger yacht,” he said.
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As analysts continue to dissect the leaked document, advocacy groups and Democratic leaders are mobilising to resist these sweeping cuts, which they argue would devastate the social safety net while exacerbating inequality.
This Republican proposal sets the stage for a fierce battle in Washington, as Democrats prepare to defend critical programmes that millions of Americans depend on for their health, food security, and overall well-being. With the stakes so high, the political divide over the country’s economic priorities appears wider than ever.
