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Washington, D.C. – Yesterday, Rep. Ralph Norman (SC-05) joined Rep. Chip Roy (TX-21) and 20 other House Republicans in sending a letter to their colleagues urging structural Medicaid reform to be included in the upcoming budget reconciliation package.

Background

Originally designed as a safety-net program for low-income children, pregnant women, seniors, and individuals with disabilities, Medicaid has drifted far from its 1965 mission. In recent years, structural flaws, a lack of eligibility enforcement, and continuous financial schemes have led to skyrocketing costs and inefficient spending.

The Congressional Budget Office now projects that from 2025 to 2034, Medicaid spending will be $1.2 trillion higher than forecasted in 2021. Much of this increase is not the result of improved care. Instead, it stems from flawed policies, including the Affordable Care Act’s expansion model, which rewards states with a 90% federal match for able-bodied, working-age adults, compared to just 60% for the truly vulnerable.

Improper payments have exceeded $1.1 trillion over the past decade, with many states exploiting loopholes such as provider taxes and intergovernmental transfers to artificially inflate federal contributions. Meanwhile, Medicaid now serves more individuals above the poverty line than below it. In California, federal funds have been used to expand coverage to illegal immigrants and eliminate asset tests, allowing even wealthy residents to qualify for taxpayer-funded care.

The letter outlines three guiding principles: prioritize the truly vulnerable, end the use of financial gimmicks, and strengthen state accountability. Without action, Medicaid will continue to drain federal resources, increase healthcare costs nationwide, and push the program further from its original intent.

Statement

“Medicaid was never meant to be a bottomless well of taxpayer money," said Rep. Norman on Thursday. "It was created to help the most vulnerable, not to reward states for gaming the system or to cover able-bodied adults who can and should work. We’ve got to stop enabling waste and start restoring accountability. This reform is about protecting both patients and taxpayers, and I’m proud to support it.”