Senate Republicans' plan to pass President Donald Trump's "One Big, Beautiful Bill" by their self-imposed July 4 holiday deadline is facing a major setback.
Last week, the Senate Finance Committee released the tax and healthcare parts of the bill, which included a provision that would limit provider taxes. States levy taxes on health care providers like hospitals and nursing homes to raise the money to receive federal matching dollars for Medicaid.
Immediately, hospitals denounced it, saying it could decimate rural hospitals, which led to Republican Sens. Josh Hawley of Missouri, Thom Tillis of North Carolina and Susan Collins of Maine to criticize the provision.
To get this massive bill over the finish line, Republicans plan to sidestep the 60-vote threshold known as the filibuster through the process of budget reconciliation, wherein they can pass a bill with a simple majority as long as it relates to taxes and spending.
But on Thursday, the Senate parliamentarian, Elizabeth MacDonough, said the Republicans' plan to cap a tax that states use to raise money for Medicaid did not pass the narrow rules of budget reconciliation, known as the "Byrd rule," which determines what can be included in a reconciliation bill.
The parliamentarian serves as the nonpartisan rules arbiter in the Senate. Going back to the 1974 Budget Control Act, the parliamentarian determines which parts of a reconciliation bill comply "the Byrd Rule." The rule determines whether legislative text directly relates to the budget, does not involve Social Security, produces a change in outlays or revenues, increase the deficit beyond the years described in the bill, or is "merely incidental" to spending, which is to say the policy changes would outway any budgetary effects.
Hawley said that he spoke to Trump about the legislation when the president flew back from the NATO summit in the Hague earlier this week.
"He likes the house framework, because he helped negotiate it," Hawley said. "Yeah, that's a pretty good framework, and I said, 'Yeah, I agree with that.' So, we'll see."
To make matters worse for Republicans, MacDonough's office struck key parts of the immigration provisions in the bill that would have required immigrants pay exorbitant fees to pay for applications, processing fees and legal proceedings.
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