Senate Parliamentarian Orders Removal of CFPB Provisions from Reconciliation Bill as Senate Prepares for Potential Vote This Week

By Kim Johnson, NLIHC Senior Director of Policy 

The Senate Finance Committee, which has jurisdiction over tax and healthcare policy in the Senate, began reviewing its version of the “One Big Beautiful Bill Act” for potential violations of the Byrd Rule, which governs the kinds of provisions that can be included in a reconciliation bill.   

Under this process, referred to as the “Byrd Bath,” the Senate Parliamentarian works with members of the Finance Committee to review the text of a reconciliation bill and identify Byrd Rule violations. Under the complicated rules governing the reconciliation process, any provision in a reconciliation bill must have a direct impact on federal spending or tax revenues; if a provision is included that violates this key rule, it must either be removed from the bill or the bill will be subject to the usual 60-vote threshold required in the Senate, rather than the simple majority of 51 votes allowed under reconciliation.   

One policy identified by the Senate Parliamentarian for removal is a proposal to cap funding for the Consumer Financial Protection Bureau (CFPB), effectively slashing an estimated $6.4 billion from the agency. The CFPB was created in the wake of the 2008 financial crisis to help protect consumers from “unfair, deceptive, or abusive practices” and to help enforce anti-discrimination consumer finance laws and investigate consumer complaints. In addition, the Parliamentarian ruled against provisions that would cut funding for the Office of Financial Research and eliminate the Public Company Accounting Oversight Board. The Parliamentarian also ruled a provision that would repeal funding already authorized under the “Inflation Reduction Act of 2022.”   

While Senate Majority Leader John Thune (R-SD) is hoping to bring the bill to a vote in the Senate as soon as this week, Senators Ron Johnson (R-WI), Rick Scott (R-FL), and Mike Lee (R-UT) are calling for deeper cuts to Medicaid, putting them at-odds with some of their Senate colleagues, including Senators Josh Hawley (R-MO) and Lisa Murkowski (R-AK), who have raised concerns about the impact cuts to Medicaid would have on their constituents. Still, Republicans in the House and Senate aim to finalize and pass the bill before the July 4 holiday.  

Impact of Medicaid provisions on healthcare access for people experiencing homelessness  

The reconciliation bill would also make changes to the Medicaid program that would make it more difficult for people experiencing homelessness to find and maintain healthcare coverage. As the National Health Care for the Homeless Council (NHCHC) explains, addressing verification requirements for Medicaid that the reconciliation bill would impose would pose a significant barrier for people who are living on the street or in cars, shelters, or other temporary spaces. Citizenship verification requirements would also be challenging to navigate, as homelessness makes it extremely difficult for people to store or obtain essential documents like birth certificates, Social Security cards, or IDs, which can be stolen or lost in an encampment sweep and difficult to replace. The bill would also require eligibility redetermination for Medicaid recipients every six months, which is not only inefficient but exceedingly difficult for people experiencing homelessness who likely do not have consistent or reliable access to mail, phone, or the internet. Likewise, the bill would establish monthly work reporting requirements, which are burdensome and challenging for individuals who may not have reliable access to a phone or internet.   

While housing assistance is not a target for cuts, the anti-poverty programs being considered for cuts play a crucial role in maintaining economic stability for people and families with low incomes, helping them afford food and receive necessary medical care. The financial assistance these programs provide also promotes housing stability by assisting families to afford the cost of food and other necessities, leaving more money at the end of the month to ensure rent is paid. States can also use Medicaid to cover health-related social needs, including housing. 

Advocates can learn more about the potential impact of the reconciliation bill on their states using the Center on Budget and Policy Priorities factsheets, available here, and contact their congressional officials to urge them to oppose the bill’s proposed cuts to Medicaid and SNAP using the Coalition on Human Need’s Take Action portal.