Illustration: Lindsey Bailey / Axios
The health care system is bracing for impending cuts to Medicaid, but with Congress, the possibility always exists that some cuts will be delayed or never take effect at all.
Why it matters: Delaying cuts in President Trump's tax and spending law even for a few years could cushion the blow to providers of nearly $1 trillion in Medicaid rollbacks while also adding to the deficit.
The big picture: The phasedown of Medicaid provider taxes, which states use to help finance their share of program costs, doesn't begin until 2028, potentially giving Congress time to push off implementation.
- Sen. Josh Hawley has already said he hopes to delay those cuts — or stop them.
- Congress has a long history of short-circuiting scheduled cuts to health care programs, like the "doc fix" for Medicare physician pay or DSH payments to hospitals. The latest Medicaid changes could be fodder for more such extenders.
- "We already have an experience with this," said Marc Goldwein, senior vice president at the Committee for a Responsible Federal Budget, noting how the Affordable Care Act called for Medicaid DSH cuts that Congress never allowed to take effect.
- Goldwein called provider taxes on hospitals and other providers "legalized money laundering" but said he is worried the changes in the new law would be pushed off "in a doc fix–type situation."
Between the lines: It is far from certain that Congress will push off any of the cuts. But hospitals are certainly going to try.
- Beth Feldpush, senior vice president of advocacy and policy at America's Essential Hospitals, told Axios this week that the group would work to soften the blow, which could include extending implementation dates.
- Hawley also said he is going to make a push. "I'm going to do everything I can to try to stop these provider tax [changes] that we have delayed," he told reporters before the Senate vote on the reconciliation package.
- The Medicaid work requirements take effect Dec. 31, 2026, setting up a major implementation challenge for states with a tight timeline. Although Republicans will not be eager to delay them, states could seek extra time for implementation.
The bottom line: Betting on Congress for relief from deadlines is a risky proposition.
- Much also depends on how the midterm elections go. If Democrats win big next year, they have a better chance of rolling back some of the cuts.
