Three Actual Facts that Cut Through MAGA Spin about their Looming Cuts to Medicaid
As Republicans in Congress prepare to make huge reductions for a "big, beautiful bill" that enables Trump tax cuts, they're also ginning up false arguments to disguise what they're up to
By Jonathan Cohn The Bulwark
Sometimes policy debates are complicated.
This isn’t one of those times.
I’m talking about the debate over the future of Medicaid, which is shaping up to be one of the most important issues Congress will address this year.
Republicans want to slash funding for the program, although so far they’ve been speaking purely in hypotheticals. They’ve offered hazy statements of intentions, memos with broad descriptions of policy ideas, ambiguous leaks to the press—everything short of actual policy specifics.
Until now.
This week, the House Energy and Commerce Committee plans to mark up the Medicaid legislation, which means Republicans on the committee will have to say exactly what they want to do. The time for trial balloons is giving way—with a pop—to the time of brass tacks.
So this is when things get tough for the Republicans. Most of them don’t like the idea of large government health insurance plans like Medicaid, and they are desperate for savings to make up for lost revenue in the “big, beautiful” tax-cut bill they are writing for Donald Trump. At the same time, they don’t want to take the political heat for attacking a program that more than 70 million mostly low-income Americans (including quite a few Republican voters) rely on for health care.
GOP leaders are going to do their best to present their plans as something other than an attack on Medicaid—by promising to “protect the vulnerable” and to focus only on “waste, fraud, and abuse,” and by hoping the flurry of jargon and numbers that swirl around in legislative debates make it hard to tell what’s really happening.
But the debate doesn’t have to go down this way. You can see through the spin. Here are three key facts—three “prebuttals”— as Republicans trot out their case for Medicaid cuts.
1. There is no practical way to take big money out of Medicaid without taking health care away from people.
Last week the Congressional Budget Office released estimates of several policy options Republican leaders said they were considering, including several under which the federal government would reduce its contributions to the program. These options would indeed reduce federal spending, according to CBO. But they’d also lead to significant numbers of Americans losing their coverage.
In fact, CBO predicted, nearly all of the options Republicans are considering would cause more than a million people to become uninsured. One option, which would restrict states’ use of a financial workaround to draw down extra federal dollars, would lead to 3.9 million more people uninsured.
And those aren’t the only options under consideration, nor are they likely to be the only ones in legislation. Some version of “work requirements” is virtually certain to end up in the bill. Proposals to have some Medicaid beneficiaries pay premiums (which mostly doesn’t happen in Medicaid now) are reportedly getting a look. A rollback of Biden-era rules requiring nursing homes to maintain higher staff levels has also been bruited.
Republicans may say CBO has overestimated the effects of cuts on insurance coverage or access to health care. That’s certainly possible. Like all policy modeling, predicting how health policy changes will work out in the real world isn’t precise science.
But error can run in both directions. And there’s good reason to think CBO is underestimating the number of people who will lose insurance. As longtime health policy writer Andrew Sprung noted, CBO made highly optimistic, possibly unrealistic assumptions about whether states will kick in more of their own money for Medicaid if the federal government reduces its share.
This much seems certain, though: Taking hundreds of billions of dollars out of Medicaid will affect the huge numbers of people who now depend on the program.
“It will mean coverage losses, raising costs, diminishing access to care, making more people uninsured,” Sarah Lueck, vice president for health policy at the Center on Budget and Policy Priorities, told me. “And members of Congress who vote for this are saying, ‘that’s fine with us.’”
And what will happen to the people who lose health care access? That’s point number two.
2. The people who lose Medicaid coverage will be worse off as a result.
You might think this point is self-evident. But conservative backers of Medicaid cuts claim it isn’t—because, they frequently say, Medicaid isn’t actually that beneficial.
They base this on a loose reading of several studies. The most important is something called the Oregon Health Insurance Experiment, which used data from the early 2000s to measure the effects of Medicaid—and which failed to show a statistically significant improvement in health for people who got on the program.
The study got tons of attention because the data came from an ideal natural experiment¹ allowing for the kind of comparison rarely possible in health economics. It became the go-to citation for Medicaid critics, and you’ll find references to it today—for example, in this paper by the right-leaning Paragon Health Institute, which has been a leading proponent of cuts.
But the Oregon study had its own limits, so that measuring health effects was always going to be difficult. It also yielded plenty of results that the Medicaid critics rarely acknowledge—including findings that Medicaid improved economic well-being and self-reported status of mental health.
And in the years since, many more studies have appeared—studies that not only reinforced findings that Medicaid improved access to care and financial security, but also showed the very improvements in mortality the Oregon experiment couldn’t detect.²
“This is what happens when the literature changes,” Zack Cooper, a health economist at Yale, told me in an interview. “If you were anchoring your policy off of Oregon, you wouldn’t have thought mortality changes would occur. Now, the best research tells us that it does.”
As it happens, one of those new studies appeared just two weeks ago. In a working paper released by National Bureau of Economic Research, Dartmouth economist Angela Wyse and University of Chicago economist Bruce Meyer used an unusually large data set—based in part on census figures—to compare health outcomes in states that expanded Medicaid through the Affordable Care Act and states that did not.
Overall, the economists determined, Medicaid reduced mortality by 2.5 percent—a high figure for these sorts of interventions, especially when you consider that saving a life is merely the most extreme (if the most important) measure of better health. Many more people benefit because they get more effective treatments for injuries or chronic conditions, which in turn can have all sorts of other benefits—like making it possible for somebody to work, not to mention live with less pain or disability.
The authors went on to measure the cost effectiveness of Medicaid as a life-saving intervention and found that it ranks between regulating toxins and providing childhood vaccines (the latter of which is among the most cost-effective public health interventions).
“The paper suggests there would be 12,000 excess deaths or so over the last ten or so years from states that didn’t expand Medicaid,” Cooper said. “I think it sort of paints a picture of what happens if you really cut back on the program.”
So why would Republican leaders do this? Another good question, which leads to point number three.
3. Republicans are cutting Medicaid because of their priorities and philosophy, not fiscal necessity.
Proponents of cutting Medicaid like to say doing so is necessary to get deficits and debt under control. “Without meaningful reform,” Rep. Chip Roy (R-Texas) said last week, “Medicaid will bankrupt this country.”
This is laughable, because of the massive tax cuts Republicans are also trying to pass in the very same bill. Estimates suggest those cuts will reduce federal revenue by at least $4 trillion over the next ten years.
If deficit reduction were truly a GOP priority, they could simply cut taxes by a smaller amount³—say, by dropping the cuts that would benefit the wealthy exclusively. Instead they’re cutting those taxes, and then insisting Medicaid cuts are necessary to offset some of the lost revenue.
The distributional effects are not difficult to see.
“The Medicaid cuts predominantly fall on lower-income households, and the tax cuts primarily redound to the benefit of higher income households,” Matthew Fiedler, an economist at the Brookings Institution, told me. “And so the question is, really, do you want to shift resources from lower-income households receiving Medicaid to higher-income households receiving the big tax cuts?”
GOP leaders who support Medicaid cuts could certainly argue the answer is yes.
They could argue those tax cuts will boost the economy, and that low-income Americans ultimately stand to benefit more from that prosperity than they would from getting government-financed health care.
They could argue taking such high taxes from the wealthy is simply unfair.
They could argue that making health insurance into an entitlement contributes to a broader, detrimental culture of dependency.
All of these are intellectually defensible, and consistent with long-held conservative ideas. But to make these arguments, Republicans would first have to acknowledge that Medicaid cuts are a choice—a choice that, based on polling, most Americans would probably reject.
That’s why so many GOP leaders are saying the cuts are a necessity. They’re just hoping nobody will notice it’s not.
1-Oregon at the time had a limited pot of money for an expansion of Medicaid, and so held a lottery to choose who got coverage. That created a natural experiment, since demographically the people who got Medicaid and the ones who did not were essentially the same, only one group got Medicaid and one didn’t.
2-One important study from 2021 used census data and found “significant reductions in mortality” from Medicaid expansion.
3-Alternatively, Republicans could go after well-documented overpayment in Medicare Advantage, the private alternative to traditional Medicare. It would be easy to find hundreds of billions of dollars there.
Jonathan Cohn focuses on the substance of public policy in “The Breakdown” newsletter for The Bulwark. You can see, hear and read their large menu of content here.
(Before you go, a modest ask: we’d be much obliged if you’d pass along to a friend or family member anything of special interest you read or watch by using the “Share” button above, and urge them to sign up for a free subscription as well.
And if you’re of a mind, hit the “Pledge” button below to let us know you’d be willing to pay for Newsmakers content. We have no plans to charge right now, but are noodling about whether there is a pathway to hiring a young journalist, or two, to keep our creaky ship moving into the future.
Your co-founders collectively are 157 years old — not that much younger than the USA, which is 249. We somehow always assumed we’d be gone long before the nation.
Now we’re not so sure. JR/HF.