House Moves Budget Resolution Forward

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On February 25, the House narrowly passed its version of a Fiscal Year (FY) 2025 budget resolution (), 217–215, after Speaker Mike Johnson (R-LA) briefly pulled the resolution from the House floor when he believed he did not have enough votes to pass it. Members were quickly called back to the chamber after a handful of conservative Republican holdouts were persuaded to advance the measure. The Senate passed a much more limited budget resolution last week, so the two chambers will need to reconcile the vast differences between their respective resolutions and will likely commence an informal conference in short order.

The House resolution includes instructions for the House Energy and Commerce (E&C) Committee to reduce the deficit by “not less than” $880 billion, and it is expected that a significant amount of those required savings may come from Medicaid. The proposed Medicaid policies have been one of the most controversial issues for securing votes from moderate House Republicans in swing districts, leading Speaker Johnson himself to pledge this week that the House will look for “efficiencies” in Medicaid and “not cutting benefits for people who rightly deserve them.” E&C Chairman Brett Guthrie (R-KY) has also signaled that massive cuts to Medicaid will not occur and that, instead, the committee will address fraud, waste, and abuse—potentially including limiting or modifying Medicaid provider taxes. Other policies proposed to achieve the $880 billion in savings include: mandatory work requirements for “able-bodied adults,” particularly those enrolled in the Medicaid expansion group (roughly $100 billion); “equalizing” the federal matching rate for the expansion population and other Medicaid matching rates (roughly $700 billion); and lowering or removing the Medicaid matching rate floor (as much as $500 billion).

While it is expected that the House and Senate will actively undertake budget resolution negotiations, complicating these efforts is the need to strike a deal on FY 2025 government funding in order to avoid a shutdown on March 14. Another short-term Continuing Resolution (CR) is under discussion to provide lawmakers with additional time to come to an agreement, as well as a hybrid option that would attach certain year-long spending bills, such as defense, to a year-long CR.

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