Republicans in Congress are making their boldest move yet to advance President Trump’s domestic agenda by combining his signature tax cuts with significant reductions to Medicaid. The sweeping legislative proposal ties together key elements of Trump’s second-term platform lower tax rates, increased energy production, and tougher immigration enforcement all in an effort to energize his base and reverse sinking approval ratings.
However, the plan comes with serious political risks. To pay for the deep tax cuts, House Republicans are proposing stricter eligibility requirements for Medicaid, new restrictions on food assistance for low-income Americans, and the elimination of green energy tax breaks enacted during the previous administration. These changes threaten to cut benefits that many constituents in Republican districts rely on, raising concerns about voter backlash in the 2026 midterm elections and potentially beyond.
Despite the risks, GOP leadership is moving full speed ahead this week. Three key House committees are simultaneously working through the package’s tax revisions, healthcare reductions, and food assistance limits. The gamble is that voters will favor Trump’s broader economic vision over the immediate loss of federal support programs an outcome that could shape control of Congress for years.
The proposal to cut Medicaid stands out as particularly controversial. Although Republicans decided against the most drastic reductions that had been discussed, their current plan would still result in approximately 8.6 million Americans losing coverage, according to estimates from the Congressional Budget Office at the request of Democratic lawmakers. Even within the GOP, some fiscal hardliners argue the cuts don’t go far enough and are threatening to oppose the final legislation unless deeper reductions are made.
As the Energy and Commerce Committee convened on Tuesday to debate hundreds of billions of dollars in cuts to Medicaid, Democrats seized on the moment. They’re already signaling plans to target vulnerable Republicans who support policies that could strip healthcare coverage from their own voters, setting the stage for an intense political battle over the future of Trump’s domestic agenda.