Editorial
The so-called Big Beautiful Bill passed the House of Representatives in late May, and now is being considered by the Senate. The bill extends the 2017 tax cuts, and makes additional cuts to taxes on overtime and tips. It increases the tax deduction for state and local taxes. It also cuts spending on Medicaid, repeals electric vehicles tax credits, phases out energy investment, production and manufacturing credits, increases the tax on college endowments, and taxes remittances sent by workers in the U.S. to their families abroad. There’s probably stuff in it that won’t become apparent until it passes.
How might this bill affect local residents, if passed in the current form? The Georgetown University Center for Children and Families website (ccf. georgetown.edu/2025/02/06/medicaidcoverage- in-virginia-counties-2023/) says that in 2023, 15.8 percent of Rockbridge County residents received Medicaid benefits. Applying that percentage to the most recent population estimate of 22,368 from the Census Bureau puts the number of Medicaid recipients in the county at 3,534. Buena Vista’s Medicaid enrollment of 23.4 percent multiplied by a population of 6,581 indicates 1,540 residents on the program and the same methodology for Lexington (18.2 percent enrollment, 7,802 population) yields 1,420 participants. That puts the total Medicaid recipients for the Rockbridge area at an estimated 6,494.
The Congressional Budget Office estimates that 7.8 million people will lose coverage because of the bill, which comes out to right at 10 percent. If we assume that figure is evenly spread around the country, that means that over 600 local residents may lose health coverage.
Medicaid expansion has helped many people obtain regular care with a primary care physician. Many studies have shown that regular care, especially for chronic diseases like hypertension, diabetes and heart disease actually reduces health care costs. It does this because uninsured people with no regular care will end up in the hospital emergency room when their condition gets really bad, incurring much larger bills than if their health was managed. Often, these bills are written off because the patient can’t afford to pay. This increases the costs that hospitals must shift to insured patients and government reimbursement programs.
This says nothing for the effects on these people and their families. Whether healthcare is a right is a subject for debate, but there’s no question that as a society, we’re judged by how we treat the least fortunate among us.
The impact on the federal deficit has been widely reported and debated. Ironically, the bill is in trouble in the Senate because some Republicans are worried about this. The Congressional Budget Office estimates that the bill will add $2.4 trillion to the nation’s debt.
President Bill Clinton, along with a more bipartisan Congress, was the last president who brought in a fiscal year surplus in the late 1990s. Clinton also reduced the size of the federal workforce, but it was done with a lot of planning, relying mostly on buy-outs and retirements. It never affected the ability of government departments to do their work. He proved that the federal government could provide necessary services, keep our country strong and pay its bills. This Big Ugly Bill doesn’t do any of these things, but if you make five or six million dollars a year, it will give you a nice tax break.
There are also a number of hidden provisions that really don’t apply to the tax code, such as a change to rules on contempt of court citations in the federal judiciary called “Restriction on Enforcement.” It says no court “may enforce a contempt citation for failure to comply with an injunction or temporary restraining order” unless the party bringing the case has posted a monetary bond, which rarely happens in legal actions brought against the government. This is a free pass to any government official who ignores a lawful court order. This has no place in this bill – and indeed – no place in our legal code.
The bill does a few good things. It continues the favorable Qualified Business Income pass-through rates for small businesses, makes improvements to the rules around Health Savings Accounts, and gives small employers a tax credit for Individual Coverage Health Reimbursement Accounts. These provisions aren’t enough to outweigh all the bad features of this legislation, however. This bill, if passed – and it most likely will be with some minor changes – will be something our children and grandchildren will pay for, and tips the system even more away from a progressive tax code.
