Energy & Commerce Has Plenty of Options
Under the House's reconciliation instructions, the Energy & Commerce Committee is tasked with identifying at least $880 billion of net deficit reduction through 2034. We estimate lawmakers could generate $1.1 trillion of savings by reversing recent executive actions and adopting proposals put forward in Presidents’ budgets and recent legislation.
The Energy & Commerce Committee has jurisdiction over Medicaid, the Children’s Health Insurance Program, parts of the Affordable Care Act (ACA), most non-tax energy-related policies, and spectrum licensing. It also has shared jurisdiction over large parts of Medicare, though it generally defers to Ways & Means on major Medicare changes.
As we’ve shown recently, Energy & Commerce could achieve nearly its entire savings target – theoretically – by eliminating state financing gimmicks. For example, banning state provider taxes alone would save more than $600 billion through 2034. Other large changes to Medicaid could instead satisfy the target (see our Medicaid Budget Offsets Bank).
In this piece, we show that the Energy & Commerce Committee could also achieve its target by adopting a number of small and medium-sized policies that have previously been proposed or considered. Specifically, we identify $360 billion of potential savings from reversing executive actions put forward by President Biden, $200 billion from adopting changes introduced in recent legislation, $275 billion from enacting policies proposed by Presidents Obama and Biden, and another $255 billion by adopting additional policies proposed by Presidents Bush and Trump.
Energy and Commerce Committee Savings Options
| Policy | Savings 2025-2034 |
|---|---|
| Reverse Biden Administration Executive Actions | $360 billion |
| Repeal the "Tailpipe" Car Emissions Rule | $140 billion |
| Reverse Medicaid State Directed Payments Rule | $135 billion |
| Repeal Medicaid Eligibility and Redetermination Rule | $65 billion |
| Repeal Medicaid Nursing Home Staffing Rule | $20 billion |
| Limit, Save, Grow Act | $130 billion |
| Establish Medicaid Work Requirement^ | $120 billion |
| Rescind Unspent IRA Funds under Committee's Jurisdiction | $10 billion |
| Biden Budgets | $65 billion |
| Extend Spectrum Auctions^ | $60 billion |
| Enact Medicaid Managed Care Restrictions and Reforms | $5 billion |
| Trump Budgets | $105 billion |
| End Medicaid GME Reimbursement for Medical Residents*^ | $55 billion |
| Allow and Extend Medicaid DSH Cuts^ | $30 billion |
| Enact Power Marketing Administration and Related Reforms^ | $10 billion |
| Restore Nuclear Waste Fund Fee^ | $5 billion |
| Strengthen Medicaid Asset Tests | $5 billion |
| American Health Care Act | $80 billion |
| Encourage States to Increase Frequency of Redeterminations | $35 billion |
| Repeal 6% FMAP Bonus for Home- and Community-Based Care ("Community First Choice Option") | $20 billion |
| Repeal ACA Prevention Fund | $15 billion |
| Limit Medicaid Retroactive Eligibility to Same Month | $10 billion |
| Obama Budgets | $210 billion |
| Limit Provider Taxes to 3.5% of Revenue | $150 billion |
| Adopt Single "Blended Rate" for Each State's Base and Expansion Population | $50 billion |
| Establish Spectrum User Fee | $5 billion |
| Limit Medicaid Reimbursement for DME | $5 billion |
| Bush Budgets and Executive Actions | $150 billion |
| Reduce FMAP on Administrative Costs to 50% | $70 billion |
| Restrict State Use of Intragovernmental Transfers (IGTs) | $40 billion |
| Reduce FMAP for Case Management and Family Planning | $20 billion |
| Disallow Payment for Certain School-Based Administrative and Transportation Services | $20 billion |
| Total Savings | $1,100 billion |
*President Trump proposed to end both Medicare and Medicaid GME payments and replace them with a new funding stream. Net savings would be larger than savings from repealing the Medicaid portion.
^These policies have been proposed by multiple Administrations or legislation, but each policy is listed only in its most recent appearance.
All numbers are rounded to the nearest $5 billion and estimates do not generally account for possible interactions.
For example, President Obama’s proposal to restrict the use of provider taxes in excess of 3.5 percent of provider revenue (compared to 6 percent under current law) would save roughly $150 billion.
Repealing President Biden’s “tailpipe” rule restricting car emissions would save $140 billion – mainly by reducing collection of the electric vehicle tax credit. Replacing President Biden’s rule allowing Medicaid State Directed Payments to pay up to the commercial rate with a more reasonable cap could save an additional $135 billion, by our estimates. Establishing Medicaid work requirements – as in President Trump’s budgets and the Limit, Save, Grow Act – could generate around $120 billion of savings.
Additionally, adopting President Bush’s proposal to reduce the federal matching rate on all administrative costs, rather than certain costs, to 50 percent would save $70 billion through 2034. Adopting President Biden’s proposal to extend spectrum auctions would save $60 billion. And implementing President Obama’s proposal to establishing a single ‘blended rate’ for each state’s regular and expansion population federal matching rate could save around $50 billion (depending on details). A number of other proposals could generate tens of billions of dollars in savings each.
Even abiding by the House’s reconciliation instructions, Congress could add up to $2.8 trillion to primary deficits. To avoid worsening an unsustainable debt situation, each committee should work to exceed its savings floor or come in below its borrowing cap. The Energy & Commerce Committee has plenty of options to achieve this goal.
