The U.S. House of Representatives is planning to vote as early as today on H.R. 1, after the Senate voted 51-50 yesterday to pass the budget reconciliation package to advance major parts of the Trump administration agenda. If passed by the House, it will go to President Trump to be signed into law; however, if amended, it will need to go back to the Senate again or potentially to be conferenced with the Senate version.
Vice President J.D. Vance cast the tie-breaking vote in the Senate yesterday, after three Republican Senators voted against the bill, Senators Rand Paul (R-KY), Thom Tillis (R-NC), and Susan Collins (R-ME). Senator Lisa Murkowski (R-AK) made a late decision to support passage of the bill after winning numerous concessions from Republican leadership, but noted she expects the House to make further changes to continue negotiations with the Senate.
Importantly, the Senate-passed bill does not impact Medicaid assisted living programs. This has been a top policy priority of Argentum and we have been working closely with policymakers to ensure they understood the critical importance of this program and potential harm to seniors who participate in the program if cuts were imposed.
Additionally, the Senate-passed bill includes a $6,000 deduction for seniors, which may help to offset some long-term care expenses. While this is not the targeted long-term care tax credit we were seeking, such as the bipartisan Credit for Caring Act that would provide a $5,000 tax credit to offset long-term care expenses, we believe that our message is resonating with lawmakers and we will continue to advocate for its passage, either as negotiations continue with the budget reconciliation process, or as a separate measure this Congress.
Another Argentum priority was inclusion of the Freedom to Invest in Tomorrow’s Workforce Act (H.R. 1151 & S. 756). This provision would allow tax-exempt distributions from 529 savings plans to be used for additional qualified higher education expenses, including “qualified postsecondary credentialing expenses” in connection with “recognized postsecondary credential programs” and “recognized postsecondary credentials.” We believe this will be helpful for senior living workers seeking to advance their career through various credentialing programs. Argentum has been working with the Tomorrow's Workforce Coalition to advance this measure.
One of the more notable changes from the bill as introduced over the weekend is that it no longer imposes a 10-year ban on state and local regulation of artificial intelligence. The measure was introduced by Senate Commerce Chair Ted Cruz (R-TX) in an effort to pause regulation until a national framework can be established. Several Senate Republicans, including Marsha Blackburn (R-TN), Josh Hawley (R-MO), Rand Paul (R-KY), and Kevin Cramer (R-ND) pushed for its removal and successfully did so with the passage of an amendment by a 99-1 vote.
Other notable provisions of the legislation include:
- $4.5 trillion in tax cuts and $1.2 trillion in spending reductions
- Nearly $1 trillion in Medicaid reductions, including new work requirements for certain adults, new co-payments, and limits on federal reimbursements to states
- New cap on State provider taxes for states that expanded Medicaid under the Affordable Care Act
- $50 billion rural provider relief fund for certain provider types located in rural areas
- 12% permanent expansion of the low-income housing tax credit (LIHTC)
- Expanded work requirements for food assistance programs and penalties for states with error-prone systems
- An increase in the state and local tax (SALT) deduction cap from $10,000 to $40,000 for five years, which would then revert to the current $10,000 limit
- The elimination or phase-out of most clean energy tax credits established by the Inflation Reduction Act
- $5 trillion increase to the debt ceiling
- Significant funding increases for the DOD, ICE, CBP, and DOJ for interior immigration enforcement, deportation, and border security
Hours after passing the Senate, the House held a hearing in the Rules Committee to setup the process for considering the bill. The committee voted 7-6 to pass the rule, with Representatives Chip Roy (R-TX) and Ralph Norman (R-SC) voting against the measure. The rule must next be passed on the House floor in order for the bill itself to be considered.
It is unclear if House Republicans currently have the votes needed for passage, with moderate Republicans concerned about more expansive reforms to Medicaid, which had been blunted in the House-passed version at their request, while the House Freedom Caucus has shared concerns about the significant debt and deficit expansion of the package and less robust spending cuts.
Additionally, logistical challenges complicate the vote math, as lawmakers had planned to be on recess this week, and weather conditions have canceled numerous flights into Washington, D.C. As of this morning, there were 206 (of 212) House Democrats present, while only 182 (of 220) House Republicans were present.
Lawmakers face an internal deadline of July 4, set by the White House. However, this deadline is only internal-facing and is non-binding. The only binding deadline for a budget reconciliation package is that it must be signed into law during the budget’s fiscal year, in this case, it must be finalized no later than September 30, 2025.
