Senate Referee Strikes Out Key Medicaid Reform Provision From GOP Megabill

Originally published by The Epoch Times: Senate Parliamentarian Cuts Key Medicaid Reform from GOP Megabill

The recent decision by the Senate parliamentarian has thrown a wrench into the plans of Senate Republicans eager to push their proposed legislation to a vote in the coming days.

Senate Parliamentarian Elizabeth MacDonough has rejected a pivotal Medicaid reform provision from the GOP’s ambitious One Big Beautiful Bill Act. This ruling is a significant blow to Republican hopes of saving billions from the Medicaid program.

On June 26, MacDonough dismissed a GOP initiative aimed at capping states’ healthcare provider tax usage, a move anticipated to save hundreds of billions intended to fund permanent business tax cuts included in the broader bill.

This ruling complicates matters for Senate Republican leaders, who may now need to overhaul critical components of the bill as they scramble to meet a self-imposed deadline of July 4 for passage. Both President Donald Trump and Republican leadership emphasize the urgency of moving this substantial legislation forward.

The decision aligns with the “Byrd Rule,” named after the late Senator Robert Byrd (D-W.Va.), which restricts reconciliation bills to issues directly related to taxation, government revenue, and national debt. This rule is crucial for the Republicans, as it allows them to bypass the 60-vote filibuster threshold in the Senate and pass the One Big Beautiful Bill Act with a simple majority.

Moreover, MacDonough has also nullified other provisions, including one that would prevent Medicaid and the Children’s Health Insurance Program (CHIP) from denying coverage to individuals whose immigration status cannot be immediately verified.

Another rejected measure aimed to cut funding for states that provide Medicaid to undocumented immigrants. Provisions restricting Medicaid and CHIP funds from covering transgender surgeries and denying Medicare to illegal immigrants were similarly deemed irrelevant under the Byrd Rule.

Furthermore, a provision prohibiting undocumented immigrants from enrolling in the Affordable Care Act (ACA) was ruled out of order as well.

“The Byrd Rule must be upheld, and Republicans should not circumvent the established reconciliation guidelines,” stated Senate Budget Committee Ranking Member Jeff Merkley (D-Ore.) on June 26. “Democrats will continue to oppose every element of this Big, Beautiful Betrayal of a bill that violates Senate rules and adversely impacts families, students, and workers. We are dedicated to fighting against Republicans’ plans that raise out-of-pocket healthcare costs and limit access to necessary reproductive care.”

Other provisions dismissed included one that would have barred unauthorized immigrant students from receiving financial aid and expanded Pell Grants for unaccredited and for-profit educational institutions.

“Democrats are standing firm against Republican attempts to dismantle Medicaid, undermine the Affordable Care Act, and push vulnerable populations, including children, veterans, seniors, and individuals with disabilities, off their health insurance—all to finance tax breaks for the wealthy,” Merkley added in a statement. “While Republicans scramble to revise their bill to further their agenda of ‘families lose, billionaires win,’ Democrats are prepared to scrutinize any modifications and ensure compliance with the Byrd Rule.”

Though Republicans have the option to overrule the parliamentarian, Senate Majority Leader John Thune (R-S.D.) has expressed reluctance to take such a step, stating that it “would not be a favorable outcome for advancing the bill.”

Calls for MacDonough’s dismissal have emerged from some Republicans, with Senator Tommy Tuberville (R-Ala.) advocating for her removal “ASAP” on social media. Senator Roger Marshall (R-Kan.) noted that in 2001, Majority Leader Trent Lott dismissed the Senate parliamentarian during reconciliation, suggesting that a similar action is needed today.

The One Big Beautiful Bill Act, which narrowly passed the House last month, will require another vote in the House if the Senate adopts a revised version.

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