House Republicans are steamrolling toward Friday morning’s scheduled Budget Committee markup even as a growing number of issues threaten to block progress on their “big, beautiful bill.”
GOP leaders went back and forth overnight with conservatives after they threatened to tank the bill over key disagreements around Medicaid work requirements and IRA tax credits. Other holdouts are pushing to postpone the markup until all the Congressional Budget Office scores are released, which could take days.
And even if they do strike an agreement in time for the 9 a.m. markup, it could be more or less a handshake. Republicans won’t be able to tweak actual language in the bill Friday — they’ll have to wait for the Rules markup on Monday. And with a list of outstanding issues from different factions in the conference, any addition to smooth tensions could cause a chain reaction of other defections.
Here are the latest sticking points to watch:
MEDICAID — Hard-liners appear to have gotten a bone here, with GOP leadership signaling they are seriously considering moving up the implementation of new work requirements in the program from 2029 to 2027. That could lead to tens of billions of dollars in savings, but would also lead to more coverage losses ahead of the 2028 election.
Most moderates appear on board, but it’s unclear if the changes will be enough to placate hard-liners, who feel the current proposed cuts are woefully insufficient. Conservatives are also pushing for immigrants in the country illegally to be immediately removed from Medicaid access. But additional changes like that could reignite moderates’ wariness.
Meanwhile, Rep. Kat Cammack and other GOP Floridians have concerns about provisions freezing taxes that states levy on providers to finance their Medicaid programs, saying they would hurt Florida more than other states. Still, Cammack voted Energy and Commerce’s portion with those policies out of committee.
IRA CLIMATE TAX CREDITS — Hard-liners are also demanding a faster phase-out of clean energy tax credits enacted under former President Joe Biden’s Inflation Reduction Act. But Hill GOP defenders of the clean energy incentives now have to decide how far to push their demands to spare at least some of the credits.
“We have alternative language and it’s something we’re going to work with leadership to try to get them to implement,” said Rep. Andrew Garbarino (R-NY), co-chair of the House Bipartisan Climate Solutions Caucus.
Speaker Mike Johnson promised to use a “scalpel” and not a “sledgehammer” in any tax credit changes.
FEDERAL EMPLOYEE PENSIONS — Some Republicans are also concerned about a proposal to spur federal employees to contribute more money to their retirement savings. Several moderate Republicans met with Johnson throughout Thursday on the issue.
“You can change people’s pensions that are coming into the workforce,” Rep. Don Bacon (R-Neb.) told POLITICO. “Don’t change them when they’ve been working. You don’t change the rules on people.”
The plan would hit lawmakers and congressional staffers’ own wallets.
STATE-AND-LOCAL-TAX DEDUCTIONS — The latest proposed number from a key group of blue-state Republicans is $62,000, said Rep. Nick LaLota (R-NY). That’s more than double the current offer in the bill, prolonging the impasse between SALT Republicans and GOP leadership.
“A lot of work to do if we’re going to get this one big, beautiful bill over the finish line, especially by Memorial Day,” LaLota said on Thursday. “Still a lot of variables.”
What else we’re watching:
— Crypto vote incoming: Majority Leader John Thune moved Thursday to tee up landmark cryptocurrency legislation for a procedural vote on the Senate floor early next week. The move comes as negotiators circulate an updated draft of the crypto bill that includes new concessions to Democrats.
— Tucked into the tax bill: The sprawling tax package before the House is pocked with the sort of bespoke tax breaks lawmakers in both parties have long lamented. In a search for votes, and hemmed in by their tiny majority, Republicans have proposed a hodgepodge of tax provisions aimed at narrow constituencies.
— Senate warnings ahead: Key Senate Republicans say the House GOP’s proposal to slash funding for the nation’s largest food aid program would push too many costs on states and won’t pass their chamber. “I’ve read [the House’s bill], and I think it’s going to have a do-over,” Sen. Chuck Grassley (R-Iowa) said.
Samuel Benson, Brian Faler, Jasper Goodman, Meredith Lee Hill, Katherine Tully-McManus and Lawrence Ukenye contributed to this report.
