Efforts to cut Medicaid funding are intensifying on two fronts: In Congress, where Republicans are plotting another round of reductions, and in the courts, where Maine clinics are suing the Trump administration over blocked reimbursements.
The developments come as House Republicans consider a second reconciliation package that could include additional structural changes to Medicaid—targeting both the federal share of spending and the clinics receiving it.
GOP looks to expand Medicaid cuts in second megabill
House conservatives, led by the Republican Study Committee (RSC), are exploring new spending reductions following the passage of President Trump’s “One Big Beautiful Bill” last month. That bill already imposed hundreds of billions in Medicaid cuts, including work requirements and restrictions on providers.
Now, a closed-door briefing scheduled this week features Brian Blase, president of the conservative Paragon Health Institute and a key proponent of deeper Medicaid reforms. Blase previously urged structural cuts to the program and played a role in shaping the first bill’s Medicaid provisions.
The RSC briefing is expected to cover:
- Reducing the federal match rate for Medicaid
- Expanding Health Savings Accounts
- “Site-neutral” Medicare payments
- Changes to the 340B drug pricing program
- Repealing or replacing ACA tax credits expiring this year
House leaders are also considering new offsets, with Medicaid and even Medicare once again in the crosshairs. “It’s clear we’re scraping the bottom of the barrel for cuts,” said one GOP source familiar with the planning.
But not everyone in the party is aligned. Members of the business-friendly Main Street Caucus have warned against deeper cuts, citing political risks and economic impacts on low-income populations.
Maine clinics sue over Trump-era Medicaid rule
While congressional Republicans weigh future changes, the impact of past Medicaid cuts is already being felt.
In Maine, a network of clinics known as Maine Family Planning (MFP) is suing the Trump administration after being stripped of Medicaid funding under provisions in the “Big Beautiful Bill.” The law bars reimbursements to any provider primarily engaged in family planning services that received more than $800,000 in Medicaid funding in 2023.
Though the bill doesn’t mention Planned Parenthood by name, it was clearly designed to target it—and, as a result, Maine Family Planning was swept up as well.
MFP operates 18 clinics across the state, many in rural areas, providing essential services like:
- Cervical cancer screenings
- Contraception
- Primary care for low-income patients
About 8,000 patients rely on MFP, and roughly 70% have no other provider.
Without restored funding, MFP says it will be forced to end all primary care services by October.
Legal battle over abortion and Medicaid access
The Trump administration argues that MFP’s lawsuit is “legally groundless,” asserting that no constitutional right to abortion funding exists. The legal language in the bill intentionally avoids direct reference to abortion services, instead targeting family planning providers more broadly.
In court filings, the Centers for Medicare & Medicaid Services contend that the new rules comply with existing law. MFP, however, argues that the reimbursement ban is politically motivated and endangers basic health access for thousands of rural residents.
This case could set a precedent for how far future Medicaid restrictions can go—and which providers might be targeted next under GOP proposals.
What’s next for Medicaid?
With House Republicans preparing their second legislative push this fall and ongoing litigation over funding bans, Medicaid remains a central flashpoint in the national health care debate.
- Expect more resistance from moderate Republicans and vulnerable incumbents
- Court rulings could limit or embolden federal restrictions on provider reimbursements
- The expiration of ACA tax credits could create new premium spikes if not addressed
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