It is, of course, wildly frustrating how economic indicators are all moving in the wrong direction these days. Consumer confidence? Down. S&P 500? Down. Unemployment? Edging up. And so forth.
People are worried—self included. I’m so “tired of winning,” in fact, I divested entirely from the stock market last week. With all of the the uncertainty and confidence in a downward spiral, it is absolutely unhelpful to threaten the health care of middle and low income Americans when they are already struggling to purchase groceries and pay the bills.
A modicum of reassurance would really be handy right about now. One way policymakers can reassure is to make it clear that, no matter what happens, they’ll not be left without a safety net. For almost 72 million Americans, that net comes in the form of Medicaid. It provides essential medical services, supports mental health care, and is a major source of funding for hospitals, community health centers, physicians, and nursing homes. It is a backstop these Americans can count on.
Lawmakers apparently may be considering a scheme to pull or at least reel back this safety net from under the neediest Americans. To illustrate, House policymakers recently passed a budget resolution that called for some deep spending cuts.
“This resolution simply unlocked the process for us to address important issues — including tax cuts for working class families, lowering energy costs, and stopping the flow of deadly drugs into our country — through a larger legislative package,” Rep. Rob Wittman, R-Vir., explained. That is true, but the resolution also hinted at deep cuts in Medicaid funding. Perhaps as much as $880 billion in cuts over the coming years. That would be devastating for tens of millions of Americans.
Medicaid significantly improves healthcare access and outcomes for children and young adults, ensuring they receive necessary medical care, preventive services, and treatments. It also reduces financial strain on families by covering medical expenses that would otherwise be unaffordable. It delivers peace of mind to Americans who live hand-to-mouth.
Deep cuts in Medicaid would also have dangerous knock-on effects.
A recent report from the Commonwealth Fund and the George Washington University showed that potential budget cuts to Medicaid and the Supplemental Nutrition Assistance Program could damage the economies of every state. “If implemented, these combined cuts could lead to one million jobs lost, a $113 billion decline in states’ gross domestic products, and $8.8 billion in lost state and local tax revenue in 2026 alone,” the researchers write.
The problem comes from ripple effects. Medicaid cuts would cause layoffs in medical fields: as many as 477,000 healthcare jobs would be eliminated if the topline numbers in the proposed GOP budget are correct. That would leave hospitals, nursing homes, and clinics understaffed.
Another 411,000 jobs would be lost in other businesses, the report suggests, as people who have supported the medical jobs lose their positions as well. That’s everything from consultants and receptionists to drug store clerks. Fewer people working means fewer paying state and local taxes, of course, which could plunge by $7 billion.
This isn’t the way to help the poor. Instead of talking about cutting Medicaid, it might be better to expand it as a stronger safety net in case people lose their jobs in a potential recession.
President Trump gets it. “Medicare, Medicaid: none of that stuff is going to be touched,” he told Fox News. He’s made similar vows more than once, and Americans know Trump keeps his word. He is certainly correct to say there are plenty of savings available without slashing Medicaid.
“The Government Accountability Office estimates just within 70 programs in the federal government a $2.7 trillion in waste, fraud, and abuse. And then fraud, government-wide, they say on the higher end is $5 trillion,” Rep. Jodey Arrington, the Republican chair of the Budget Committee, said. “So we have to put the program integrity measures in place to make sure those who are legally eligible are those receiving the benefits that the taxpayers and lawmakers intended.”
Exactly. It’s literally his job to find that waste, and he can do so without simply taking a chainsaw to Medicaid.
At this critical time, the House would be well advised to reassure nervous vulnerable Americans that it will move forward with a budget that works for everyone, sparing the valuable Medicaid program.