With razor-thin margins, the Republican-controlled House and Senate gave final passage to the enormous reconciliation bill that will extend 2017 tax cuts, slash Medicaid and food assistance, and add trillions to the national debt.
Kentucky is expected to lose billions of dollars in federal Medicaid spending under the bill. Hundreds of thousands of Kentuckians are forecasted to lose Medicaid coverage and the state would be on the hook to pay for a portion of food assistance benefits.
Risking retaliation from President Donald Trump, Kentucky’s GOP Sen. Rand Paul and Rep. Thomas Massie voted against the bill, arguing the price tag is too high and deeper cuts are needed. Kentucky’s sole Democratic congressman, Rep. Morgan McGarvey, also voted against the legislation, although for the opposite reason; Democrats and some moderate Republicans fear the bill will decimate rural health care and kick needy Americans off health coverage and food assistance.
Massie and McGarvey voted against the bill again Thursday after it came back from the Senate with major changes, including increased Medicaid cuts and with a higher price tag. The bill now heads to Trump’s desk, where he is essentially sure to sign it, after the legislation successfully made it through both chambers by his self-imposed July 4 deadline.
A Trump-associated PAC has already begun running attack ads against Massie, citing both his vote against the reconciliation measure and his active dissent against U.S. involvement in the Israel-Iran war. Massie, a fiscal hawk, was one of the two House Republicans to vote against finally passing the bill.
Rep. Andy Barr, who is running for Senate in an already crowded GOP primary, spoke on the floor in support of the bill, pointing to provisions that would eliminate taxes on overtime and up to $25,000 in tips income.
“Today, Kentucky families, workers, and small businesses got a historic tax cut — jet fuel for our economy and a boost for Kentuckians still recovering after four years of Bidenflation,” Barr said. “This is the latest and greatest chapter of the Trump economic comeback — and the theme is promises made, promises kept.”
Middle-income taxpayers would save between $500 and $1,000 a year, while the top 10% would see gains of about $12,000 annually, according to the nonpartisan Congressional Budget Office.
While Republicans celebrated the bill, the Kentucky Democratic Party denounced it. They pointed to various statistics that show Kentucky will lose $12.3 billion in federal Medicaid funds in rural areas and 35 rural hospitals are at risk of closing.
“Today, Republican members of Kentucky’s Congressional Delegation approved the largest loss of health care in U.S. history,” said Kentucky Democratic Party Chair Colmon Elridge. “The long-term outcome of the GOP’s gross betrayal is an indefensible truth: rural clinics, hospitals, nursing homes and addiction recovery programs will disappear outside of big cities and Kentuckians who would otherwise have health care will lead shorter, sicker lives.”
Medicaid and SNAP cuts
Rep. Brett Guthrie, who represents a portion of western Kentucky, spoke early Thursday morning on the House floor. He said the bill protects Medicaid and promotes innovation. Guthrie previously cited the Kentucky Hospital Association’s support as evidence the bill would not harm Kentucky health care — he did not cite the organization again, which now says the latest version of the legislation will decimate the industry.
“We claw back wasteful and unnecessary spending,” Guthrie said “We secure Medicaid for those who need it most: mothers, children, seniors and those with disabilities. Democrats continue to fearmonger and misrepresent what’s in this bill.”
The Medicaid cuts in particular could have a big impact on Kentucky, where one in three people are covered under the federal program.
The Kentucky Hospital Association, which originally supported the House version of the bill, says limitations to their state-directed payments and provider taxes will endanger as many as 33,000 jobs and force Kentucky hospitals already operating on slim margins to close or cut services. In a letter, the leaders of more than 100 Kentucky hospitals said the cuts will likely lead to the biggest cuts to services for rural citizens.
“Many will simply go without care and those that seek it will have to travel long distances to overcrowded urban hospitals that will be overwhelmed and challenged to meet the need,” the letter read. “Without access to care, the health of Kentuckians will deteriorate, and the state’s economy will face serious setbacks.”
The group estimated Kentucky would see $150 million in reduced tax revenue and more than $1.7 billion in lost economic activity. Hundreds of thousands of Kentuckians are expected to lose their Medicaid coverage over the next decade, largely due to work requirements and more frequent eligibility checks, which opponents fear will kick off eligible people who fail to report correctly.
McGarvey said Thursday morning on MSNBC that the bill is a “slap in the face to Kentuckians.” He cited estimates that say 35 rural hospitals in Kentucky will close due to Medicaid cuts and 133,000 rural Kentuckians will lose coverage.
The bill also implements large cuts to the federal food stamps program, shifting the cost to states based on the unintentional error rate of under or over-payments. It also requires parents with children 7 years and older to meet work requirements and raise the working age to 64.
State government and politics reporting is supported in part by the Corporation for Public Broadcasting.
