Some key Alaska state legislators are pushing back on the Republican budget package known as the “big, beautiful bill.”
With U.S. Senate votes coming soon, state Senate Majority Leader Cathy Giessel, R-Anchorage, said she and House Speaker Bryce Edgmon, I-Dillingham, thought it was time to ring the alarm bells.
“Bryce and I … have been astonished and dismayed at what we're seeing Congress looking at doing to our Medicaid program,” Giessel said in a phone interview Friday.
In a New York Times opinion piece Friday, the pair of legislative leaders argued the tax- and spending-cuts package would “throw state budgets into chaos” for rural states like Alaska.
Roughly one in three Alaskans has Medicaid coverage. Edgmon, who represents Bristol Bay and other rural Southwest Alaska communities, said the program props up communities throughout rural Alaska.
“It's so interwoven as a whole into our entire economy out here — everything from air taxis to restaurants to transportation to certainly health care itself,” Edgmon said in a phone interview from Dillingham.
The New York Times piece he co-authored with Giessel is headlined “Alaska Cannot Survive This Bill.”
Changes to Medicaid and the federal food aid program known as SNAP could push some families into bankruptcy and leave others without enough food on the table, Edgmon said. He and Giessel wrote that cuts to SNAP could force village grocery stores to close.
“The SNAP program, I'd characterize as one of the sleeper programs in Alaska, because it does provide a lot of benefits to people that sort of escapes … the average person's comprehension of how important it is,” Edgmon said.
SNAP, the Supplemental Nutrition Assistance Program, pays for food for roughly 70,000 low-income Alaskans. All of the money for that food currently comes from the federal government, though the state shares half of the cost of administering the program.
The House-passed version of the One Big Beautiful Bill Act would, for the first time, require states to pay part of the cost of benefits.
A Senate proposal would push up Alaska’s SNAP costs by roughly $50 million, according to data Giessel shared from the state Division of Public Assistance.
The status of that provision in the Senate bill is in flux. It was recently stripped out of the bill under the rules the Senate is using to avoid a filibuster, but Republican leaders say they plan to push it back in as the bill approaches procedural votes, amendments and a final Senate vote, a process that could start as soon as Saturday.
Giessel says the changes couldn’t come at a worse time for Alaska’s already-stressed state budget. Lawmakers approved an austere spending plan this year as low oil prices sent them scrambling.
“It's going to be hard to find that money,” she said. “How much more are we going to cut from the Department of Transportation? How much more are we going to cut from the Department of Corrections? How much more are we going to have to reduce our commitment to education?”
The impact of Medicaid changes on the state budget is less clear. The House-passed version of the bill would reduce federal spending on Alaskans’ health care by roughly $200 million per year and leave tens of thousands of Alaskans without health coverage, according to the Kaiser Family Foundation and health care groups.
Giessel argues that would force some costs indirectly onto state and local employees’ health insurance, since more uninsured Alaskans would forgo primary care and instead show up at emergency rooms — federal law requires them to treat everyone, even if they can’t pay.
Defenders of the tax and spending cuts package, though, say opponents vastly overstate the impacts on Alaska’s budget.
Much of the projected loss in Medicaid spending is linked to a proposed work requirement for adults without children. But the most recent Senate draft has exemptions for Alaska Native people covered by the Indian Health Service, people with serious mental health conditions, including substance abuse, people living in areas where the unemployment rate is above 8%, pregnant and postpartum mothers, and people receiving major medical care outside their home community.
The state’s chief Medicaid administrator, Department of Health Deputy Commissioner Emily Ricci, said those broad exemptions mean it’s tough to anticipate just how many Alaskans might lose Medicaid coverage.
“Many national estimates don’t reflect Alaska’s unique circumstances or the exemptions in the bill that apply here, so they may overstate the impact on our state,” she said in a statement. “The bill is not complete, the Department is closely tracking as it develops.”
House Minority Leader Mia Costello, an Anchorage Republican, said in a statement that the bill “protects our most vulnerable while ensuring that benefits are targeted and sustainable.”
“It is narrowly focused on the subset of adults who are fully able to work but choose not to,” she said.
Gov. Mike Dunleavy, in a statement on social media, pointed to a broad range of energy-related provisions in recent Senate drafts that would ease drilling on federal land and direct more oil and gas tax revenue to the state, and another that would provide $300 million to homeport an icebreaker in Juneau.
Costello said the bill, which also extends and expands tax cuts passed in 2017, would give the state’s economy a boost.
“To claim Alaskans can’t ‘survive’ a federal budget bill that is due to unleash so many aspects of our economy while maintaining benefits to our most vulnerable is misguided,” she said.
But Giessel, who is a family practice nurse practitioner, questioned whether Alaskans would truly benefit from the bill’s carve-outs.
“What does it take to get an exemption? It takes someone applying for that exemption,” she said. “I can tell you that people applying right now, even for Medicaid benefits, are waiting months.”
Another Republican legislative leader, Senate Minority Leader Mike Shower of Wasilla accused Giessel and Edgmon of fearmongering and questioned the pair’s commitment to reining in costs in the state budget.
“The leadership in the Alaska Legislature refuses to entertain anything along the lines of a balanced and realistic fiscal policy. Instead, it’s how to protect government, no discussion of protecting and encouraging the private sector, and how we are going to tax Alaskans to pay for a state government that — by their own tacit admission in the (opinion piece) — we can’t really afford,” Shower said in a statement.
As of Friday afternoon, Senate leadership has yet to unveil the final text of the bill, even as they plan to vote as soon as this weekend. Edgmon says that makes it difficult to assess what it would mean for the state in any appreciable level of detail.
The bill is likely to span hundreds of pages, and Edgmon says the race to pass the fast-changing bill by the president’s July 4 deadline makes it hard to anticipate the consequences.
“I don't think anybody, even ourselves as long term legislators, have a full understanding of what those impacts could be as they trickle down the entire economy,” he said.
The Congressional Budget Office, which analyzes the impact of federal legislation, said last month that the House’s version of the megabill would on average, accounting for both the tax and benefit cuts, increase the resources available to the average American. But the highest-income households would come away with more — while those in the bottom 10% would be worse off.
Edgmon and Giessel closed their opinion piece with a warning.
“Alaska is one of the most amazing places in our country,” they wrote. “Congress is risking our way of life to give money to the rich.”