Trump’s 'Big, Beautiful Bill' Stumbles: Senate Rules Gut Key Medicaid Reforms

President Donald Trump’s much-touted 'big, beautiful bill' has hit a significant roadblock in the Senate, as key Medicaid provisions were struck down by Senate Parliamentarian Elizabeth MacDonough. The ruling, based on the Byrd Rule, has stripped away core cost-saving measures that were central to the Republican agenda, dealing a blow to their ambitious timeline of landing the bill on Trump’s desk by July 4.

The Senate’s version of the bill included a controversial crackdown on Medicaid provider tax rates, which would have lowered rates in certain states annually until reaching a mere 3.5%. Other provisions, such as denying states Medicaid funding for covering illegal immigrants and restricting funds for gender-affirming care, were also axed. These changes had already sparked dissent among some Republican senators like Susan Collins of Maine and Josh Hawley of Missouri, who feared the impact on rural hospitals and working Americans’ benefits.

A Senate Divided
The parliamentarian’s decision highlighted a critical flaw: limiting states’ ability to tax healthcare providers could jeopardize care for millions who rely on Medicaid. Senate Democrats, seizing the opportunity, have vowed to intensify their opposition through the so-called 'Byrd Bath,' meticulously challenging provisions that fail to meet Senate rules. Senator Jeff Merkley of Oregon didn’t mince words, calling the bill a 'Big, Beautiful Betrayal' that prioritizes tax breaks for the wealthy over the needs of families, veterans, and seniors.

What’s Next?
With key elements gutted, Senate Republicans are scrambling for solutions. One proposal gaining traction is a stabilization fund for rural hospitals, potentially distributing $15 billion over five years to states in need. Yet, with internal divisions and fierce Democratic pushback, the path forward for Trump’s flagship legislation remains uncertain. The clock is ticking, and the stakes couldn’t be higher.