Senate GOP tax bill is said to target key Medicaid provision, omit Medicare cuts

The U.S. Senate’s version of the GOP tax bill has no plans to impose funding cuts to Medicare health insurance program but includes a proposal to lower the Medicaid provider tax to 3.5%, multiple news outlets reported Monday.

The Senate Finance Committee is set to publish a draft version of President Donald Trump’s flagship tax bill on Monday. In late May, the bill dubbed the “One Big Beautiful Bill Act” narrowly cleared the House.

The GOP proposal to lower the Medicaid provider tax to 3.5% is a significant departure from the House-passed bill, which called for a moratorium on states’ ability to increase their Medicaid provider tax beyond the current 6%, Politico reported.

A group of GOP senators who are concerned about the negative impact the proposal will have on rural hospitals is likely to strongly oppose the move. “Hell no,” one moderate House Republican noted on the condition of anonymity.

Meanwhile, Bloomberg News reported that Senate Republicans have discontinued efforts to cut costs in the Medicare program as part of the tax bill.

In early June, health insurers mainly focused on the Medicare Advantage market, which traded lower amid concerns that GOP senators were eyeing potential funding cuts to the government-backed health insurance program.

Health insurers: UnitedHealth (NYSE:UNH), Humana (HUM), CVS Health (NYSE:CVS), Cigna (NYSE:CI), Clover Health (CLOV), Alignment Healthcare (ALHC), Centene (CNC), Molina Healthcare (NYSE:MOH), Elevance Health (ELV)