Washington, D.C. — House Republicans are weighing a new round of reductions to federal health care spending, this time to help fund a $200 billion budget request tied to the ongoing U.S.-Israel military campaign against Iran. For nursing home operators, the prospect of additional Medicaid cuts lands on top of wounds that haven’t healed from last year.
According to reporting from Axios on Monday, top House Republicans are looking at health care offsets as part of a reconciliation package that would cover the Pentagon’s war funding request. House Majority Leader Steve Scalise told the outlet, “There’s other items we’re looking at right now, especially in the areas of fraud and waste and abuse that we’re working through with our members.” That same language was used last year to justify more than $1 trillion in Medicaid and health care cuts under the so-called Big Beautiful Bill.
House Budget Committee Chairman Jodey Arrington is also reviving a proposal to cut cost-sharing reduction payments under the Affordable Care Act — a move the Congressional Budget Office previously estimated would cause an additional 300,000 Americans to lose coverage on top of the 14 million already projected to lose insurance by 2030.
What It Means for Long-Term Care
Nursing homes rely on Medicaid for roughly two-thirds of their revenue on average. The Big Beautiful Bill that passed last year already imposed historic Medicaid restrictions, including new work requirements and tighter eligibility rules. Operators spent most of 2025 bracing for the financial fallout — and many still are. Another round of federal health spending cuts would compound the pressure.
Research published earlier this year warned that reductions to Medicaid home care programs could push a million or more dual-eligible seniors into nursing homes, straining facilities that are already understaffed and underfunded. If the new cuts move forward, that dynamic could intensify while simultaneously shrinking the Medicaid dollars facilities need to operate.
A Divided GOP
The war supplemental isn’t universally popular within Republican ranks. Senator Rand Paul told media he’s “not for the war, and so I’m not for funding more of the war.” Representatives Lauren Boebert, Chip Roy, and Thomas Massie have each raised concerns about authorizing more funding without clearer goals. That internal resistance could complicate the timeline — but it hasn’t stopped leadership from exploring how to make the numbers work.
The Iran conflict itself is broadly unpopular with the American public, with more than 60 percent disapproving according to CBS News polling. And the closure of the Strait of Hormuz has already driven up energy costs and disrupted supply chains across industries — adding to the financial strain that nursing homes and other long-term care providers are already navigating.
Watch This Space
No specific cuts to long-term care programs have been announced, and the reconciliation process remains in early stages. But the direction is clear: health care spending is again on the table in Washington, and nursing home operators will want to watch how this unfolds. Industry groups are expected to push back hard, as they did during the Big Beautiful Bill debate last year.
