Republicans did not cut Medicaid

OPINION:

Democrats have made a striking claim central to their midterm message: that Republicans have “cut” Medicaid by as much as $1 trillion.

It’s a powerful line. It’s also misleading.

According to the nonpartisan Congressional Budget Office, Medicaid spending is projected to rise every year for the foreseeable future, totaling more than $8.3 trillion from 2027 to 2036. Federal spending alone is expected to grow from roughly $700 billion annually today to nearly $1 trillion by 2036.

In Washington, apparently, slightly slower spending growth counts as a “cut.”

By any reasonable interpretation, Republicans are not slashing Medicaid spending. They are trying to prevent the program from eating up an even bigger share of the Treasury, largely by targeting waste, fraud and ineligible enrollment.

That effort matters, given how dramatically Medicaid has expanded in recent years.

During the pandemic emergency, the federal government effectively barred states from removing ineligible beneficiaries from Medicaid rolls. Enrollment surged from about 80 million people in early 2020 to more than 94 million by 2023, a roughly 17% increase.

Not all those enrollees were eligible. One estimate from the Paragon Health Institute suggests that 6.6 million Medicaid beneficiaries in 2024 did not qualify for the program, at a cost of nearly $37 billion annually to taxpayers.

At the same time, improper payments — including fraud, billing errors and payments to ineligible recipients — have soared. Paragon estimates that improper payments in Medicaid exceeded $100 million in each and every year of the Biden administration. Over the past decade, such payments have totaled more than $1 trillion.

In short, Medicaid spending hasn’t just grown. It has grown faster than the country can responsibly sustain and enabled massive amounts of impropriety.

The budget law enacted by Republicans last year aims to address those problems, in large part by restoring basic program integrity.

For instance, the law requires states to conduct more frequent eligibility checks for certain Medicaid enrollees. That is hardly radical. Medicaid is a means-tested program. Ensuring that beneficiaries meet eligibility requirements is a basic administrative responsibility.

The law also establishes work or community engagement requirements for able-bodied, working-age adults who gained coverage under the Affordable Care Act’s expansion of the program. These individuals must work, train or volunteer 80 hours per month in exchange for taxpayer-funded coverage.

The legislation also places new limits on states’ use of provider taxes. Financing arrangements allow states to inflate Medicaid spending on paper to attract additional federal matching funds.

The feds provide at least one dollar for every dollar a state spends on Medicaid. Provider taxes game that formula by extracting money from providers, returning it to them in the form of higher reimbursement rates and collecting a commensurate amount from the federal government for their troubles.

The new law does not eliminate the practice; it caps its growth and curtails further expansion.

None of these changes constitutes “cuts” in any meaningful sense. There are attempts to tighten oversight and reduce improper spending in a program that now costs hundreds of billions of dollars each year.

Even with these reforms, Medicaid spending will continue to rise substantially.

Medicaid was designed as a safety net for the most vulnerable: low-income families, the disabled and the destitute elderly. Preserving that mission requires ensuring that limited public resources are directed to those who are both eligible and in genuine need.

Labeling modest efforts to control costs as “cuts” may be politically appealing, but it obscures the real challenge and makes serious reform that much harder.

• Sally C. Pipes is president, CEO and Thomas W. Smith fellow in health care policy at the Pacific Research Institute. Her latest book is “The World’s Medicine Chest: How America Achieved Pharmaceutical Supremacy — and How to Keep It” (Encounter 2025). Follow her on X @sallypipes.