By Megan Michaud and James Myall
Congress, where Republicans have a majority, is considering pairing spending cuts for food security, health, and other important programs with enormous tax cuts for the wealthy. Committees in the House of Representatives this week moved pieces forward to create the whole package — the “reconciliation bill.”
Here’s the latest
- House Republicans advanced a bill that guts food and health care programs to pay for tax cuts for billionaires — all in one brutal package.
- It includes the largest Medicaid cut in U.S. history — over $880 billion — putting health care at risk for tens of thousands of Mainers.
- It will cut $230 billion from SNAP over the next decade. 170,000 Mainers use SNAP, including families with kids and veterans.
- The plan will shift enormous costs onto states, blowing giant holes in state budgets. It even fines states that go the extra mile to cover more people.
- This is a direct attack on vulnerable Mainers: kids, older adults, disabled people, and families trying to make ends meet.
How will Mainers be impacted?
- Up to 34,000 Mainers could lose Medicaid coverage, and 31,000 could lose SNAP.
- Most of the people who will lose their coverage won’t lose it because they aren’t eligible. They’ll lose it by getting buried under mountains of red tape and relentless bureaucratic requirements. It also ends help for low-income seniors on Medicare, blocks access to gender-affirming care, and cuts access to basic health care services including cancer screenings offered by Planned Parenthood and other reproductive health providers.
- It will blow an almost $190 million dollar hole in our state budget: $90 million penalty for covering immigrant children, pregnant and postpartum people; $97 million to cover SNAP.
- For nearly 50 years, the feds covered 100% of SNAP food benefits — because fighting hunger was a national promise. This bill breaks that promise and dumps the cost on states like Maine.
- They say they’re cutting programs for “waste, fraud, & abuse.” In reality, they’re passing the buck to states while burying struggling families in red tape and making food and health care more expensive. All to fund tax cuts for the rich.
Deep Dive: Medicaid and health care
What’s in the bill?
The bill contains the largest Medicaid cuts in history of more than $880 billion.
- Creates a “community engagement” (work, education, or similar) requirement for people aged 19-64 without children, disabilities, or a “medically frail” condition and extensive requirements for reporting on income and activities. Exceptions based on individual hardship circumstances or high unemployment are subject to approval by the executive branch. States would not be legally liable for disenrolling people who are otherwise eligible.
- States get punished for covering additional immigrant populations on their own dime, such as Maine’s coverage of certain pregnant people, postpartum care, and children. The federal government will penalize Maine by reducing state funding for a separate health care program (Medicaid expansion).
- Mandatory cost sharing — such as co-pays and deductibles — for adults in the Medicaid expansion population above the poverty level.
- Elimination of coverage for gender affirming care for minors and elimination of gender affirming care as an essential health benefit in certain health insurance plans for adults under Medicaid and the Affordable Care Act.
- Blocks all Medicaid funding to Planned Parenthood and other reproductive health care providers in Maine. Patients with Medicaid can currently select these reproductive health care providers for non-abortion services such as cancer screenings, wellness visits, testing and treatment for sexually transmitted infections (STIs), and birth control consultations. (With rare exceptions people with Medicaid coverage already cannot use federal funding for abortion.)
- States cannot impose any new taxes on health care providers, such as those on pharmacies or ambulance services. Current provider taxes can remain in place.
- No extension of Advance Premium Tax Credits (APTCs), which make insurance more affordable by capping monthly premiums based on income. For a family of four making $78,000 a year, this could translate to $200 more per month for health coverage and a $1,700 per month increase for a 62 year old couple earning $82,000 a year.
- More onerous paperwork and timeline requirements for states, some health care providers, Medicaid beneficiaries, and those who enroll through the Affordable Care Act exchanges.
- Shortens the time Medicaid can pay for past medical bills from three months to one month.
- Blocks an effort to help eligible adults to more easily enroll in Medicare Savings Programs, a program in Medicaid that helps older adults afford medicine and health care costs under Medicare. As a result, one million fewer people will enroll in MSPs and their health care costs will be higher.
- Blocks an effort to help children more easily enroll in Medicaid or the Children’s Health Insurance Program (CHIP), resulting in decreased health care coverage for 1.26 million children.
Maine impact
The imposition of work requirements for the first time would require tens of thousands of Mainers to prove they meet the eligibility standards before they are able to access health care. According to the Center on Budget and Policy Priorities, up to 67,000 people will be subject to the new work requirement rules. Of these, around 11,000 are not currently working, in school, or appear to meet the definition of “medically frail.” However, the history of work requirements shows many more people will lose health care because paperwork trips them up. Based on the experience of Arkansas and New Hampshire, which used administrative data on earnings and enrollment in other programs to determine eligibility, an estimated 34,000 Mainers could lose MaineCare coverage thanks to the reconciliation bill.
The bill’s proposal to punish states who spend their own money to cover certain kinds of immigrants who don’t otherwise qualify for Medicaid would double the amount of money Maine has to spend on covering adults without dependents in the Medicaid expansion program. Maine currently provides health care to around 1,000 children, pregnant people and postpartum parents who cannot qualify for the federal program, for which the bill proposes to fine the state as much as $630 million over seven years ($90 million per year).
The failure to extend the enhanced subsidies under the Affordable Care Act would deprive Mainers of $26 million a year in help to buy insurance in the individual marketplace and lead to thousands more Mainers going without health insurance.
Weakening or blocking access to Medicaid and other affordable insurance would have widespread consequences for communities and people across Maine.
Deep Dive: Food assistance
What’s in the bill?
The bill cuts spending on the Supplemental Nutrition Assistance Program (SNAP, formerly called Food Stamps) by $230 billion over the next decade, by making the program harder to access. 170,000 Mainers use SNAP to put food on the table. The bill would:
- Expand SNAP’s existing work requirement for so-called “able-bodied adults without dependents” by newly applying it to Americans age 55 to 64 and by changing the definition of “dependent” so parents or caretakers of children aged between 7 and 17 must now meet the work requirement.
- Shift up to a quarter of the program’s costs onto state governments. Currently, the federal government covers 100% of the benefits cost and 50% of the administrative cost in the SNAP program. The bill would require states to cover 75% of the administrative costs, and between 15% and 25% of the benefit cost.
- Punish jobless Americans even in a recession. Currently, states can get a waiver from these work requirements if parts of the state are experiencing high unemployment, in recognition of the fact that it would be unfair to punish people who can’t find jobs when there aren’t any available. The bill would raise the bar for getting a waiver and make the waivers shorter in duration.
- Exclude non-citizens and many immigrants from using the program. Currently, immigrants with a legal status, such as refugees and people granted asylum, can receive help through SNAP. The bill would restrict the program only to citizens and permanent residents (Green Card holders).
Maine impact
The bill would have two major impacts on Maine: reducing the number of people who have access to the SNAP program; and forcing the state to pay $100 million more each year to maintain it.
The federal food security program has been around for nearly five decades, and the federal government has always covered the full cost of the food benefit and split the administrative cost of the programs with states. This was a policy choice to ensure a basic level of food security regardless of which state a person lived in. For the first time, the cost-sharing provisions of the bill would require Maine to pay twice as much to administer the program as it currently does, and to pay up to 25% of the benefit costs each year. The cost-sharing requirement for benefits is based on a state’s “error rate” in issuing payments. Because 13% of SNAP payments issued by Maine in 2023 were found to be either too high or too low, the state is likely to face the full 25% cost share. Based on current program use, Maine would face an additional $90 million in costs for benefits and an additional $7 million in administrative costs.
Expanding the work requirement would lead to tens of thousands fewer Mainers being able to access the program. An estimated 4,000 older Mainers and 27,000 parents of school-age children would be newly subjected to the work requirement. Work requirements are extremely problematic because even many SNAP recipients who work will be removed from the program because they can only find seasonal work. And many who suffer from chronic health conditions won’t qualify as disabled because they can’t meet standards of evidence. When Maine abruptly reimposed a work requirement on nearly 10,000 SNAP recipients in 2014, almost 7,000 of them (72%) were unable to meet the requirements and lost food assistance. Losses here may be even higher, since the target population (older people and parents) have more barriers to employment than prime-age adults without children.
Deep Dive: Taxes
What’s in the bill?
The reconciliation bill would not only continue the 2017 Trump Tax Cuts which overwhelmingly benefitted the wealthiest Americans, but it would also make the tax cuts even more lop-sided by adding additional breaks for those at the top. The tax provisions of the bill add almost $4 trillion to the deficit over the next decade.
A number of gimmicks, such as tax breaks on tipped income, do little to balance out the equation for working people.
Extensions of the 2017 tax law include:
- Making permanent 2017 changes to personal income tax rates and brackets. All taxpayers would be affected, but the richest one percent would receive more than a quarter of the benefits. For a household at that level, with an average income of $2.5 million, the bill preserves an average annual tax break of $55,000.
- Making permanent the 2017 change to the standard deduction and increasing it for four years.
- Making permanent a tax break for offshore profits (the GILTI deduction).
New provisions in the House reconciliation bill include:
- Increasing the deduction for state and local taxes from $10,000 per filer to up to $30,000 for married filers; the benefit phases out for the very wealthy but it remains a change which mostly benefits higher earners with expensive houses.
- Making tipped income temporarily (2025 through 2028) tax exempt, which would have minimal benefit for most workers. A similar temporary tax exemption is created for overtime earnings.
- Temporarily increasing the standard deduction for older Americans to approximate the impact of not taxing Social Security benefits. Many retirees already pay very little tax on their benefits because their incomes are so low.
- Temporarily creating a new tax deduction for the interest paid loans for American-assembled cars and trucks, which does little for low-income households who either don’t have car loans or have few tax obligations to begin with.
- Permanently increases the estate tax exemption for the heirs of wealthy Americans to $15 million (or $30 million for a couple).
- Increases the “pass through” deduction for business owners who claim business income on their personal taxes from 20 to 23 percent and makes it permanent. In 2024, 60% of this benefit went to the top 1% of households by income.
- Repealing as of the end of 2025 most of the clean energy tax credits passed under the Biden administration that put the US on track to greatly reduce its carbon emissions by 2030.
- Creates new taxes on college and university endowments and private foundations.
- Creates new administrative hurdles that will make it harder for low-income families to access the Earned Income Tax Credit.
The bill would make several significant changes to the Child Tax Credit, including:
- Temporarily increasing the maximum credit from $2,000 to $2,500 from 2025 through 2028; after that it falls back to $2,000, adjusted for inflation since 2024.
- Requiring a Social Security Number for children, the tax filer (and the filer’s spouse if married). Currently the credit only requires the child have a Social Security Number (SSN), which allows children of immigrant parents without an SSN parents to claim the credit.
Maine impact
The bill would maintain the Child Tax Credit’s already inequitable treatment of children who live in the lowest-income households. For those households which do not owe federal income tax, the maximum refundable credit will remain less than the full credit, which keeps millions of children trapped in poverty each year. In Maine, 56,000 kids will be left out of receiving the full benefit; nationwide, it’s 20 million kids left out, who live in homes with a median income of just $23,000 a year. It’s important to note these tax provisions would be combined with the others affecting food security and access to health insurance, potentially making households with children even more financially stressed.
The change to require Social Security Numbers for the Child Tax Credit would exclude an estimated 4.5 million citizen and lawful permanent resident children from the credit. In Maine, this change would block 3,000 children from the credit.
In addition, the bill makes many provisions benefiting businesses and the wealthy (such as the “pass through” deduction) permanent, while those that ostensibly help working people (such as the no tax on tips) expire in just a few years.
The 2017 tax law expires at the end of 2025 and its provisions affect all Americans. But Congress could evaluate and extend the portions that help the middle class, workers, and families with low-income without extending tax cuts for billionaires and making the ultra-rich even richer. There is no need to cut access to food security and health insurance to pay for tax breaks for people who already have more than most.
What happens next?
House Republican leaders have stated their intention to bring all the bills together for a final vote during the week of May 19, 2025. Reps. Pingree and Golden will vote on it then.
If it passes the House, the Senate will start considering the bill. They may move quickly to pass it with few changes or they may move more slowly and write their own version. Right now, the expected timeline is a Senate vote in late June or early July.
Notes
Sources for Medicaid and health care deep dive:
Source for food assistance deep dive:
Sources for taxes deep dive:
