The Idaho House recently passed House Concurrent Resolution 25, calling for an Article V Convention to propose a federal Balanced Budget Amendment (BBA). Legislators who supported the BBA bemoaned the lack of fiscal discipline in D.C. Yet, less than a week later, the Senate Health and Welfare Committee passed Senate Bill 1264, calling for about $1 billion of borrowed federal funds to be sent to Idaho to buttress our rural healthcare system. 

A bit of background

The Idaho Freedom Foundation (IFF) has long called for repealing the expansion of Medicaid to able-bodied adults. Cost overruns are endemic. As we mentioned back in November, the Medicaid reforms (like work requirements) accompanying the passage of the “One Big Beautiful Bill Act (OBBA),” were sweetened with $1 billion to Idaho ($50 billion in total to all states) over five years for the creation of the “Rural Health Transformation Program (RHTP).” Here is a quote from Governor Little’s Press Release on the subject:

WHEREAS, on July 4, 2025, President Donald J. Trump signed the One Big Beautiful Bill Act, P.L. 119-21, preventing a massive tax increase on all Americans, further cutting taxes, shrinking the size and scope of the federal government, and making historic investments in rural health with the creation of the Rural Health Transformation Program (RHTP);

You heard that right, we have to grow the federal government after we attempt to shrink it. Now, mind you, this was not some well-thought-out plan, but rather a way to secure the vote of a key Senator, Lisa Murkowski of Alaska.  

Idaho is now vexed by these opposing forces, too. The Idaho DOGE committee recommended a hearing on repealing Medicaid expansion. The bill has yet to be heard. But the Senate Health and Welfare Committee passed Senate Bill 1264

“to establish the Idaho Rural Health Transformation Program in state statute and to create the Idaho Rural Health Transformation Fund within the state treasury.  This legislation also establishes the Rural Health Transformation Committee,a legislative oversight body responsible for governance, review, and recommendations related to the use of rural health transformation funds.” 

The bill's sponsor, Senator Kevin Cook, touted that it would provide legislative oversight. But a comprehensive grant application had already been submitted to the federal government and accepted. So, this is really window dressing to make it look like accepting more borrowed federal funds is fine as long as the Legislature has oversight. Because the first tranche of funds has to be obligated by the end of October, there is really not much time for review or any oversight. The first federal grant request is $259 million out of the nearly $1 billion total.

Is there an argument to be made that the $50 billion (national figure) handout was worth the cost to get the Medicaid cuts in the OBBA? The problem is that Medicaid is not actually being cut according to the projections from the Congressional Budget Office. The rate of growth is just projected to slow after 2025. We say projected because Medicaid has a habit of costing more than projected. And remember, slowing the rate of growth should NEVER be considered a cut.

Throwing more borrowed federal funds into Idaho’s healthcare system is not the answer to a fiscal discipline problem. We have some great doctors and facilities, but the system is failing when you consider that nationally we now spend $15,474 per capita on health care, or 18% of our Gross Domestic Product (GDP). When Medicare and Medicaid were established in 1965, the per capita expenditure was $208 and 5.6% of GDP. We are way past the point where putting more money into this system will fix it.