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For months, Republicans have been trying to figure out how to reduce Medicaid spending to help enact President Trump\u2019s domestic agenda. But their list of possible cuts is shrinking.<\/p>\n
House Speaker Mike Johnson said Tuesday that major cuts to the Affordable Care Act\u2019s Medicaid expansion were off the table<\/a>. Now, the largest cut left among their whittled-down options would disproportionately hurt states that supported Mr. Trump in the 2024 election.<\/p>\n Republicans have also been studying several other Medicaid changes for their budget bill, and a final package will probably include some of the smaller adjustments. But they have considered only two major policy pathways that can deliver the bulk of the $880 billion in spending cuts<\/a> that the House committee overseeing Medicaid has been charged with finding.<\/p>\n One policy would significantly dial back funding<\/a> for the Obamacare Medicaid expansion, which the Congressional Budget Office estimated Wednesday would save $710 billion over a decade. Some of the deepest cuts would be felt by rich, Democratic-led states. This was the option Mr. Johnson ruled out for now after meeting with moderate Republican members this week.<\/p>\n<\/div>\n<\/div>\n The remaining big cut on the table, limiting the way states use a tax loophole<\/a> to increase federal spending on Medicaid, would save $668 billion, mostly by reducing Medicaid spending in poorer, Southern states.<\/p>\n Whichever states get hit hardest would face big budget shortfalls, and to compensate some could drop Medicaid\u2019s health insurance coverage for some of their lower-income adults, cut hospital payments, or cut other government priorities.<\/p>\n \u201cThe headline number of the reduction in federal spending is similar, but everything else is extremely different,\u201d said Morgan Henderson, a health economist with The Hilltop Institute at the University of Maryland-Baltimore County, which has been analyzing Republican Medicaid proposals<\/a>.<\/p>\n The final package will most likely include some smaller Medicaid changes too, but probably needs one of the big cuts to achieve Republicans\u2019 budget goals.<\/p>\n At the core of the difference is Medicaid\u2019s financing system for patients\u2019 bills. The federal government covers a larger share of medical costs for patients in poorer states. It gives less money to richer states that can better support Medicaid with their own tax dollars.<\/p>\n<\/div>\n<\/div>\n In New York, this matching rate<\/a> is 50 percent, and the money is split evenly. In Mississippi, the rate is 77 percent, and the federal government pays about three dollars for every one dollar of state funding.<\/p>\n The federal government gives all states an exceptionally generous matching rate for anyone who signs up through the Obamacare Medicaid expansion. For those enrollees, Washington covers 90 percent of the costs.<\/p>\n<\/div>\n<\/div>\n The first Republican policy option, reducing funding for the Obamacare Medicaid expansion, would decrease the 90 percent match back to whatever share a state normally gets from the federal government. That would hit richer, Democratic states in two ways: They\u2019re more likely to participate in Medicaid expansion, and they have lower matching rates.<\/p>\n<\/div>\n<\/div>\nThe option Johnson dropped<\/h2>\n