On July 1, the Senate passed an amended version of the One Big Beautiful Bill Act (H.R. 1) (PDF) by a 51-50 vote, with Vice President JD Vance casting the tie-breaking vote. Sens. Susan Collins (R-Maine), Thom Tillis (R-N.C.), and Rand Paul (R-Ky.) joined their Democratic counterparts in opposing the measure. In a statement, AAMC President and CEO David J. Skorton, MD, and Chief Public Policy Officer Danielle Turnipseed, JD, MHSA, MPP, reaffirmed the association’s concerns with the bill’s proposed cuts to Medicaid and core student financial aid programs, underscoring that such policies would exacerbate health care workforce shortages and reduce access to care.
The Senate’s revised version of the reconciliation bill contains several key changes relative to the version passed by the U.S. House of Representatives on May 22 [refer to Washington Highlights, May 23]. Regarding Medicaid, the Senate bill introduces more stringent restrictions on state-directed payments and provider taxes, financing mechanisms used by states to fund the nonfederal share of Medicaid spending and support network adequacy and access to care for enrollees. Notably, the Senate-passed bill includes $50 billion in funding for a Rural Health Transformation Program, intended to help offset some of the negative impacts of these policies on rural providers.
The Senate-passed bill maintains higher education provisions included in the House bill that could affect medical student borrowers, including the elimination of Grad PLUS loans and streamlined income-driven repayment plans. Like the House bill, the Senate bill would lower existing caps on Unsubsidized Loans, though the caps in the Senate-passed bill would be higher than those included in the House bill. The bill also would delay new repayment terms until July 1, 2028, applying them only to new borrowers. Notably, the bill omits an exclusion of medical residents from the Public Service Loan Forgiveness Program — a policy the AAMC opposed in a June 5 letter to Senate leadership (PDF) [refer to Washington Highlights, June 6]. Like past iterations of the bill, the Senate-passed bill includes risk-sharing measures that would deny federal funds to programs whose graduates earn below the median income of bachelor’s degree holders in the same state. Medical graduates would be evaluated four years after program completion, compared to the ten-year timeline originally proposed by the Senate Health, Education, Labor, and Pensions Committee [refer to Washington Highlights, June 13].
The Senate-passed bill would also increase the endowment tax on certain institutions of higher education. The bill maintains the tiered endowment tax structure previously proposed by the Senate Finance Committee in an earlier version of the bill [refer to Washington Highlights, June 20]. However, the Senate-passed version contains several key revisions to the tax, including adjustments to the methodology for calculating endowment per student.
The House began consideration of the bill on July 2, with a goal to pass the measure ahead of the Fourth of July holiday.
- Washington Highlights