Trump's budget slashes billions in Medicaid, CHIP funding

Donald Trump speaks in White House Rose Garden
President Donald Trump's 2018 budget proposal would cut more than $600 billion from Medicaid in addition to billions already axed from the program in the American Health Care Act. (

President Donald Trump’s comprehensive budget for 2018 is putting pressure on Republicans who want to preserve expanded Medicaid, as it calls for additional cuts to the program on top of those proposed by the American Health Care Act.

Reports ahead of the budget’s release on Tuesday indicated that the budget would align with cuts to Medicaid proposed in the AHCA, which would ax more than $800 billion from the program. But the official figures (PDF) put forth by the Office of Management and Budget call for an additional $610 billion in cuts over the course of 10 years as a result of limits to Medicaid funding.

The goal of the budget as a whole is to wipe out the annual deficit by 2027, and it calls for deep cuts in areas like healthcare and social welfare while boosting funding for defense and the Department of Veterans Affairs.

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The cuts in funding as outlined in the budget would come as a result of reforming Medicaid payments as either a per capita cap or a block grant beginning in fiscal year 2020, and the decreases in tandem with those proposed in the House of Representatives bill would cut funding for Medicaid by more than 47% by its final year.

The Children’s Health Insurance Program (CHIP) also faces cuts, as the budget calls for $6 billion to be slashed from that program in 2020. Medicare funding is left untouched, though analysts suggest that strain on the Medicaid program could be felt in Medicare as well.

The budget proposal drives another nail in the coffin for Medicaid expansion, which was on the chopping block in the AHCA and would be phased out in 2020 as the program was augmented. The administration’s clear stance puts the spotlight on Republican senators who were likely to advocate for a more moderate approach to Medicaid reform in their own version of the healthcare bill.

Sen. Bill Cassidy, R-La., told Politico that he suspects the OMB failed to “review [Trump's] campaign contract to the American voter.” Trump previously assured his base that he would not cut Medicare, Social Security or Medicaid if elected.

Fiscal conservatives in the Senate, however, were more enthusiastic about the president and House bill’s plans.

“It’s like all government programs, they continue to expand beyond what you’ve contemplated,” Senate Finance Chairman Orrin Hatch, R-Utah, told the publication. “I don’t want to pull the rug out from under people, but I think we’ve got to have a system that has some sense to it.”

Meanwhile, some Democrats were not shy about their disdain for the proposal on social media: