Senate Majority Leader John Thune is scrambling to quell the Medicaid-fueled mutiny that’s threatening to derail the megabill on both sides of the Capitol.
In the Senate, “Medicaid moderates” are rejecting Finance’s opening offer of $15 billion for a stabilization fund for rural hospitals to help offset paring back the provider tax in expansion states from 6 percent to 3.5 percent.
Sen. Susan Collins (R-Maine) called it “inadequate” and warned that even if leadership goes up to the $100 billion she’s seeking, “that doesn’t solve” her issues with the bill. Thune closed the door to $100 billion soon after.
Multiple senators are threatening they won’t vote to open floor debate on the megabill without more clarity on Medicaid changes. That includes Sen. Thom Tillis (R-N.C.), who warned colleagues behind closed doors Wednesday that “you won’t have a member from North Carolina sitting at this table after next year” unless the Senate changes course, Jordain scooped. (Reminder, fellow North Carolina Sen. Ted Budd isn’t up for reelection until 2028.)
Sen. Josh Hawley (R-Mo.) later posted on X that he spoke with Donald Trump and the president wants the Senate to “stay with the House” on Medicaid. Look for whether Trump issues further instructions Thursday: Several GOP senators are expected to head to the White House for a 4 p.m. event to tout the “big, beautiful bill.”
Over in the House, wary moderates are also rejecting the rural hospital fund; one told POLITICO it’s “bullshit.”
Speaker Mike Johnson is trying to calm nervous members by telling them he expects the Senate Medicaid language will move closer to the House’s. House GOP leaders and moderates believe the provider tax will end up between 4 percent and 5 percent, according to four people granted anonymity to describe private conversations. Some House Republicans are prepared to swallow that. Others are protesting.
Those numbers aren’t currently under serious consideration in the Senate, two people granted anonymity to describe the talks told POLITICO, where there’s general skepticism that rank-and-file Republicans across the Capitol have a good read on the negotiations. (Johnson and Thune are in close contact, though; the Senate leader stepped out of Wednesday’s lunch on the phone with his House counterpart.)
But a Senate shift could end up happening if Thune’s members force his hand. Asked Wednesday about softening the provider-tax language, Thune didn’t completely close the door. “This all comes down to what the traffic will bear,” he told POLITICO.
Other outstanding megabill issues:
— Feeling less salty?: Blue-state House Republicans expected to receive two options in writing for a potential deal on the state and local tax deduction. Rep. Mike Lawler (R-N.Y.) said the SALT Republicans’ Wednesday meeting with Treasury Secretary Scott Bessent and Sen. Markwayne Mullin (R-Okla.) involved a “productive conversation.”
— Public-lands push and pull: POLITICO obtained Sen. Mike Lee’s (R-Utah) scaled-back plan to sell off millions of acres in public lands, which he’s shipped off to the parliamentarian for review. It could still face GOP pushback.
— Inside RonJohn’s White House talks: Sen. Ron Johnson (R-Wis.) told POLITICO the White House is working with him to establish a budget review panel through reconciliation. He’s not a “yes” on the megabill yet, though.
What else we’re watching:
— Iran briefing: Senators will huddle at 2 p.m. for their rescheduled briefing on the Iran conflict. As of late Wednesday night, the potential speaker list included Defense Secretary Pete Hegseth, Secretary of State Marco Rubio, CIA Director John Ratcliffe and Joint Chiefs Chair Dan Caine, but Senate aides cautioned the list could change.
— Leg Branch markup: House appropriators will mark up the Legislative Branch funding bill Thursday — and there is a lot they want to see changed on Capitol Hill, according to their committee report released Wednesday. The panel had thoughts on member security, designated parking spaces, food service that accommodates more allergies and celiac disease, elevator outages and dome tours ahead of Thursday’s markup.
James Bikales, Josh Siegel and Katherine Tully McManus contributed to this report.
