Senate parliamentarian blocks key Medicaid cuts in ‘One Big Beautiful Bill’

Senate Majority Leader John Thune, R-S.D., and Republicans might have to go back to the drawing board on proposed Medicaid cuts. ALEX BRANDON/AP FILE

The Senate parliamentarian put a snag in President Donald Trump’s plan to pass the “One Big Beautiful Bill” by July 4 after advising that a key Medicaid provider tax overhaul does not adhere to procedural rules.

Republican leaders are relying on the Medicaid provider tax change to save billions of dollars in the GOP package to offset the cost of trillions of dollars in tax cuts that are their top priority.

The parliamentarian “advises the presiding officer, senators and their staffs, committee staffs and representatives and their staffs on all matters requiring interpretation of the Standing Rules of the Senate, the precedents of the Senate, unanimous consent agreements, and provisions of public law affecting the proceedings of the Senate,” according to the Senate website.

The decision could force Senate Majority Leader John Thune to return to the drawing board and pause a vote on the bill this week.

Some Republicans called on the Senate to fire or overrule Parliamentarian Elizabeth MacDonough, according to Politico. When asked by news outlet about overruling her, Thune said, “No, that would not be a good option for getting a bill done.” MacDonough has been Senate parliamentarian since 2012.

GOP leaders will have to consider revising the tax cut, strip it or it could be challenged during floor votes, requiring a 60-vote threshold to keep it. Republicans are expected to rewrite the provisions to try and win MacDonough’s blessing, according to Politico.

While Democrats are unified against Trump’s bill, some Republicans warned the $600 billion cuts to Medicaid could potentially leave millions without healthcare coverage.

Sen. Ron Wyden, top Democrat on the Senate Finance Committee, said the GOP proposal would have been as much as a $250 billion cut to the health care program, “massive Medicaid cuts that hurt kids, seniors, Americans with disabilities and working families.”

States impose the taxes as a way to help fund Medicaid, largely by boosting the reimbursements they receive from the federal government. Critics decry the system as a type of “laundering,” but almost every state except Alaska uses it to help provide health care coverage.

The House-passed bill would freeze the provider taxes at current levels, while the Senate proposal goes deeper by reducing the tax some states are able to impose.

Additionally, the parliamentarian ruling blocks the Senate from prohibiting Medicaid funding for gender-affirming care and limiting coverage for non-citizens.

Editor’s note: Associated Press contributed to this article.

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