spending bill

WASHINGTON — Lawmakers have left Washington for the annual August recess, but a few weeks of relative quiet on the U.S. Capitol grounds can’t mask the partisan tensions that are brewing on government funding and President Trump’s nominees. It could make for a momentous September.

Here’s a look at what’s ahead when lawmakers return after the Labor Day holiday.

A bitter spending battle ahead

Lawmakers will use much of September to work on spending bills for the coming budget year, which begins Oct. 1. They likely will need to pass a short-term spending measure to keep the government funded for a few weeks while they work on a longer-term measure that covers the full year.

It’s not unusual for leaders from both parties to blame the other party for a potential shutdown, but the rhetoric began extra early this year, signaling the threat of a stoppage is more serious than usual.

On Monday, Senate Democratic leader Charles E. Schumer and House Democratic leader Hakeem Jeffries sent their Republican counterparts a sharply-worded letter calling for a meeting to discuss “the government funding deadline and the health care crisis you have visited upon the American people.”

They said it will take bipartisanship to avert a “painful, unnecessary shutdown.”

“Yet it is clear that the Trump Administration and many in your party are preparing to go it alone and continue to legislate on a solely Republican basis,” said the letter sent to Senate Majority Leader John Thune and House Speaker Mike Johnson.

Republicans have taken note of the warnings and are portraying the Democrats as itching for a shutdown they hope to blame on the GOP.

“It was disturbing to hear the Democrat leader threaten to shut down the government in his July 8 Dear Colleague letter,” Thune said on Saturday. “… I really hope that Democrats will not embrace that position but will continue to work with Republicans to fund the government.”

Different approaches from the House and Senate

So far, the House has approved two of the 12 annual spending bills, mostly along party lines. The Senate has passed three on a strongly bipartisan basis. The House is pursuing steep, non-defense spending cuts. The Senate is rejecting many of those cuts. One side will have to give. And any final bill will need some Democratic support to generate the 60 votes necessary to get a spending measure to the finish line.

Some Democratic senators are also wanting assurances from Republicans that there won’t be more efforts in the coming weeks to claw back or cancel funding already approved by Congress.

“If Republicans want to make a deal, then let’s make a deal, but only if Republicans include an agreement they won’t take back that deal a few weeks later,” said Sen. Elizabeth Warren, D-Mass.

Rep. Chuck Fleischmann, R-Tenn., a veteran member of the House Appropriations committee, said the Democratic minority in both chambers has suffered so many legislative losses this year, “that they are stuck between a rock and their voting base.” Democrats may want to demonstrate more resistance to Trump, but they would rue a shutdown, he warned.

“The reality would be, if the government were shut down, the administration, Donald Trump, would have the ability to decide where to spend and not spend,” Fleischmann said. “Schumer knows that, Jeffries knows that. We know that. I think it would be much more productive if we start talking about a short-term (continuing resolution.)”

Republicans angry about pace of nominations

Republicans are considering changes to Senate rules to get more of Trump’s nominees confirmed.

Thune said last week that during the same point in Joe Biden’s presidency, 49 of his 121 civilian nominees had been confirmed on an expedited basis through a voice vote or a unanimous consent request. Trump has had none of his civilian nominees confirmed on an expedited basis. Democrats have insisted on roll call votes for all of them, a lengthy process than can take days.

“I think they’re desperately in need of change,” Thune said of Senate rules for considering nominees. “I think that the last six months have demonstrated that this process, nominations, is broken. And so I expect there will be some good robust conversations about that.”

Schumer said a rules change would be a “huge mistake,” especially as Senate Republicans will need Democratic votes to pass spending bills and other legislation moving forward.

The Senate held a rare weekend session as Republicans worked to get more of Trump’s nominees confirmed. Negotiations focused on advancing dozens of additional Trump nominees in exchange for some concessions on releasing some already approved spending.

At times, lawmakers spoke of progress on a potential deal. But it was clear that there would be no agreement when Trump attacked Schumer on social media Saturday evening and told Republicans to pack it up and go home.

“Tell Schumer, who is under tremendous political pressure from within his own party, the Radical Left Lunatics, to GO TO HELL!” Trump posted on Truth Social.

Freking writes for the Associated Press. AP writers Mary Clare Jalonick and Joey Cappelletti contributed to this report.

Shorter enrollment periods. More paperwork. Higher premiums.

The sweeping tax and spending bill pushed by President Trump includes provisions that will not only reshape people’s experience with the Affordable Care Act, but also sharply undermine the gains in health insurance coverage associated with it, according to some policy analysts.

The moves affect consumers and have particular resonance for the 19 states (plus Washington, D.C.) that run their own ACA exchanges.

Many of those states fear that the additional red tape — especially requirements that would end automatic reenrollment — would have an outsize impact on their policyholders. That’s because a greater percentage of people in those states use those rollovers versus shopping around each year, something more commonly done by people in states that use the federal healthcare.gov marketplace.

“The federal marketplace always had a message of, ‘Come back in and shop,’ while the state-based markets, on average, have a message of, ‘Hey, here’s what you’re going to have next year, here’s what it will cost; if you like it, you don’t have to do anything,’” said Ellen Montz, who oversaw the federal ACA marketplace under the Biden administration as deputy administrator and director at the Center for Consumer Information and Insurance Oversight. She is now a managing director with the Manatt Health consulting group.

Millions — perhaps up to half of enrollees in some states — may lose or drop coverage as a result of that and other changes in the legislation combined with a new rule from the Trump administration and the likely expiration at year’s end of enhanced premium subsidies put in place during the COVID-19 pandemic.

Without an extension of those subsidies, which have been an important driver of Obamacare enrollment in recent years, premiums are expected to rise 75% on average next year. That’s starting to happen already, based on some early state rate requests for next year, which are hitting double digits.

“We estimate a minimum 30% enrollment loss, and, in the worst-case scenario, a 50% loss,” said Devon Trolley, executive director of Pennie, the ACA marketplace in Pennsylvania, which had 496,661 enrollees this year, a record.

Drops of that magnitude nationally, coupled with the loss of Medicaid coverage for millions more people under the legislation Trump calls the “One Big Beautiful Bill,” could undo inroads made in the nation’s uninsured rate, which dropped by about half from the time most of the ACA’s provisions went into effect in 2014, when it hovered around 14% to 15% of the population, to just over 8%, according to the most recent data.

Premiums would rise along with the uninsured rate because older or sicker policyholders are more likely to try to jump enrollment hurdles, while those who rarely use coverage — and are thus less expensive — would not.

After a dramatic all-night session, House Republicans passed the bill Thursday, meeting the president’s Friday deadline. Trump is expected to sign the measure on Independence Day. It will increase the federal deficit by trillions of dollars and cut spending on a variety of programs, including Medicaid and nutrition assistance, to partly offset the cost of extending tax cuts put in place during the first Trump administration.

The administration and its supporters say the GOP-backed changes to the ACA are needed to combat fraud. Democrats and ACA supporters see this effort as the latest in a long history of Republican efforts to weaken or repeal Obamacare. Among other things, the legislation would end several changes put in place by the Biden administration that were credited with making it easier to sign up, such as lengthening the annual open enrollment period and launching a special program for very low-income people that essentially allows them to sign up year-round.

In addition, automatic reenrollment, used by more than 10 million people for 2025 ACA coverage, would end in the 2028 sign-up season. Instead, consumers would have to update their information, starting in August each year, before the close of open enrollment, which would end Dec. 15, a month earlier than currently.

That’s a key change to combat rising enrollment fraud, said Brian Blase, president of the conservative Paragon Health Institute, because it gets at what he calls the Biden era’s “lax verification requirements.”

He blames automatic reenrollment, coupled with the availability of zero-premium plans for people with lower incomes that qualify them for large subsidies, for a sharp uptick in complaints from insurers, consumers and brokers about fraudulent enrollments in 2023 and 2024. Those complaints centered on consumers being enrolled in an ACA plan, or switched from one to another, without authorization, often by commission-seeking brokers.

In testimony to Congress on June 25, Blase wrote that “this simple step will close a massive loophole and significantly reduce improper enrollment and spending.”

States that run their own marketplaces, however, saw few, if any, such problems, which were confined mainly to the 31 states using the federal healthcare.gov.

The state-run marketplaces credit their additional security measures and tighter control over broker access than healthcare.gov for the relative lack of problems.

“If you look at California and the other states that have expanded their Medicaid programs, you don’t see that kind of fraud problem,” said Jessica Altman, executive director of Covered California, the state’s Obamacare marketplace. “I don’t have a single case of a consumer calling Covered California saying, ‘I was enrolled without consent.’”

Such rollovers are common with other forms of health insurance, such as job-based coverage.

“By requiring everyone to come back in and provide additional information, and the fact that they can’t get a tax credit until they take this step, it is essentially making marketplace coverage the most difficult coverage to enroll in,” said Trolley at Pennie, 65% of whose policyholders were automatically reenrolled this year, according to KFF data.

Federal data show about 22% of federal sign-ups in 2024 were automatic reenrollments, versus 58% in state-based plans. Besides Pennsylvania, the states that saw such sign-ups for more than 60% of enrollees include California, New York, Georgia, New Jersey and Virginia, according to KFF.

States do check income and other eligibility information for all enrollees — including those being automatically renewed, those signing up for the first time, and those enrolling outside the normal open enrollment period because they’ve experienced a loss of coverage or other life event or meet the rules for the low-income enrollment period.

“We have access to many data sources on the back end that we ping, to make sure nothing has changed,” Altman said. “Most people sail through and are able to stay covered without taking any proactive step.”

If flagged for mismatched data, applicants are asked for additional information. Under current law, “we have 90 days for them to have a tax credit while they submit paperwork,” Altman said.

That would change under the tax and spending plan before Congress, ending presumptive eligibility while a person submits the information.

A white paper written for Capital Policy Analytics, a Washington-based consultancy that specializes in economic analysis, concluded there appears to be little upside to the changes.

While “tighter verification can curb improper enrollments,” the additional paperwork, along with the expiration of higher premiums from the enhanced tax subsidies, “would push four to six million eligible people out of Marketplace plans, trading limited fraud savings for a surge in uninsurance,” wrote free market economists Ike Brannon and Anthony LoSasso.

“Insurers would be left with a smaller, sicker risk pool and heightened pricing uncertainty, making further premium increases and selective market exits [by insurers] likely,” they wrote.

Appleby writes for KFF Health News, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling and journalism.

Treasury Secretary Scott Bessent said the U.S. “is never going to default” as the deadline for increasing the federal debt ceiling gets closer.

“That is never going to happen,” Bessent said in an interview for CBS’ “Face the Nation” scheduled to air Sunday. “We are on the warning track and we will never hit the wall.”

Republican congressional leaders have attached an increase in the debt limit to President Trump’s tax and spending bill, which potentially puts avoiding a default at the mercy of complex negotiations over the legislation. The U.S. Senate returns this week to take up the bill.

Bessent declined to specify an “X date” — the point at which the Treasury runs out of cash and special accounting measures that allow it to stay within the debt ceiling and still make good on federal obligations on time.

“We don’t give out the ‘X date’ because we use that to move the bill forward,” Bessent said. Last month, Bessent told lawmakers that the U.S. was likely to exhaust its borrowing authority by August if the debt ceiling isn’t raised or suspended by then.

Wall Street analysts and private forecasters see the deadline falling sometime between late August and mid-October.

Bessent also pushed back against a warning by JPMorgan Chase & Co. Chief Executive Jamie Dimon that a crack in the bond market “is going to happen.”

“I’ve known Jamie for a long time, and for his entire career he’s made predictions like this,” he said. “Fortunately none of them have come true.”

“We are going to bring the deficit down slowly,” Bessent said. “This has been a long process, so the goal is to bring it down over the next four years.”

Czuczka writes for Bloomberg News.