Democrats Demagogue Medicaid Reforms

From the moment Republicans passed the “One Big Beautiful Bill,” the Democrats and their accomplices in the legacy “news” media began lying about its provisions. This was predictable, but the sheer scale of their mendacity, particularly with regard to Medicaid, has been appalling even by their egregious standards.

House Democratic Leader Hakeem Jeffries provided a representative example of this shameful fear-mongering just before final passage of the bill. Looking directly into the C-SPAN cameras, he stated that the legislation “guts Medicaid in a way that it’s going to hurt children, hurt families, hurt seniors, hurt people with disabilities, hurt women, hurt everyday Americans.”

This is nonsense. In fact, the OBBB doesn’t cut Medicaid. It merely slows its growth. As Treasury Secretary Scott Bessent told CNN’s Dana Bash after the President signed the bill into law, “Only in D.C. is a 20 percent hike over 10 years a cut. Medicaid funding will go up 20 percent over the next 10 years.”

Bessent explained that the program was being refocused in order to better serve the truly vulnerable Americans for whom it was originally designed – pregnant women, the disabled, and low-income families with children under 14. Also, work requirements will be imposed on the 34 million able-bodied adults now on Medicaid.

What Democrats should be concerned about is why there are so many able-bodied people on Medicaid in the first place. Obamacare expanded eligibility to include virtually all adults with incomes below 138 percent of the federal poverty level. This inevitably created an incentive for millions to drop their own insurance and enroll in Medicaid.

But it’s even worse than that. The program began as a federal-state partnership whereby the former matched the expenses of the latter one-to-one. Obamacare effectively bribed states to sign up able-bodied adults by raising the federal matching rate for such enrollees far above the 50 percent rate for the truly needy. As the Foundation for Government Accountability (FGA) reports:

An estimated 34 million able-bodied adults were enrolled in Medicaid in 2024 without any work requirements in place. In 2022, the Congressional Budget Office [CBO] estimated $135 billion in savings over nine years for a work requirement for able-bodied childless adults under 50 years old. Applying work requirements to a broader group of able-bodied adults under 60 without young children would increase those savings to $260 billion over the 2025-2034 budget window.

Obviously, the CBO wouldn’t project such significant savings from work requirements if all of these able-bodied Medicaid enrollees had jobs. In reality, however, many haven’t bestirred themselves to look for honest work. FGA gathered data from most of the states that enroll able-bodied adults: “Across 23 states with responsive records, a whopping 62 percent of able-bodied adults on Medicaid had no earned income, meaning they were not working at all.” The first Trump administration implemented a work requirement for able-bodied adults on Medicaid, and it was working well until the Biden administration arbitrarily rescinded it.

Most of the extravagant claims about the millions of people who will allegedly “lose their Medicaid coverage” are based on the faulty notion that none of the able-bodied enrollees will comply with OBBB’s modest work requirements – 20 hours per week – to keep their coverage. Yet, as Nina Owcharenko Schaefer of the Heritage Foundation points out, “The principle of integrating work as a condition of receiving welfare benefits is not new. As a matter of fact, work requirements have been part of the welfare infrastructure for decades.” Even so, Democrat demagogues like Kentucky Gov. Andy Beshear predict wrack and ruin:

It’s the single worst piece of legislation I’ve seen in my lifetime, and it is a congressional Republican and presidential attack on rural America. In my state alone, 200,000 people are going to lose their coverage. Those are 200,000 Kentuckians that deserve to see a doctor when they’re sick; 20,000 health care workers are going to lose their jobs, and we’ve got up to 35 rural hospitals that are typically the second-biggest employer in their communities that may close.

This brings us to yet another false claim routinely peddled by Democrats and their corporate media allies: The “One Big Beautiful Bill” poses a serious threat to the survival of rural hospitals. This nonsense ignores two crucial facts. First, as the public policy firm Holland & Knight notes in a July 11 alert, “OBBB provides a $50 billion fund – $10 billion annually to be administered by the Centers for Medicare and Medicaid Services (CMS) from 2026 to 2030 – for states with approved rural health transformation plans.” This will greatly benefit rural hospitals assuming bellyachers like Gov. Beshear can put together a statewide plan.

The second issue the Kentucky Governor fails to mention during his disingenuous diatribe is that the rural hospitals crisis began 12 years ago when Obamacare was enacted. Before that “reform” law took effect in 2013, rural hospitals sometimes closed, but the national rate per year remained in single digits. According to a report from the American Hospital Association, however, the closure rate immediately spiked to double digits when Obamacare hit. In 2010, only three rural hospitals closed. By 2013, more than four times that many had to shut down. For the rest of that decade, the annual number of rural hospital closures ranged from 10 to 19.

Nor has the destruction abated. According to Becker’s Hospital Review, 24 facilities were forced to shut down last year alone. Obamacare didn’t solve the uninsured problem, it simply dumped tens of millions into the Medicaid program, which doesn’t pay hospitals or physicians enough to cover the cost of care. This was devastating to rural hospitals because most who wound up on Medicaid live in rural areas. This restricted access to doctors, which forced patients to seek primary care in hospitals and caused ER overcrowding. The net result has been bankrupt hospitals.

This brings us to yet another of OBBB’s key Medicaid provisions: removing illegal aliens from the program.

During his four years in office, former President Biden allowed untold millions of illegal aliens to enter the United States while permitting states to exploit legal ambiguities to give them Medicaid. OBBB closes these statutory loopholes. As Paul Winfree of the Economic Policy Innovation Center writes, “OBBB’s reform will prompt states such as California to disenroll millions of illegal immigrants that have been added to Medicaid, preserving resources for the program’s rightful beneficiaries.” This will also ease the ER overcrowding caused by illegals, which has forced American citizens to wait in line at American hospitals.

In the end, OBBB’s reforms were necessary and long overdue. Yet, the Democrats and their accomplices in the corporate “news” media are lying about the “One Big Beautiful Bill.” They can’t admit that many of its provisions, particularly its Medicaid reform measures, were included in an attempt to clean up the unholy health care mess created by the Obama and Biden administrations. Americans should rest easy knowing that they can ignore the Democrats’ lies and demagoguery.

David Catron is a Senior Editor at the American Spectator. His writing has also appeared in PJ Media, the American Thinker, the Providence Journal, the Catholic Exchange and a variety of other publications.