Medicare

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The Congressional Budget Office projects that recent tax cut legislation and spending packages will increase the federal deficit by $139 billion, raising it to $804 billion in 2018. In December Congress passed a 1.5 trillion tax-cut package and early in 2018 approved a $400 billion budget. The CBO projects the US will return to a trillion dollar deficit by next year. Last week Congress submitted a plan to make up the difference with cuts to Medicare, Medicaid and Social Security. The above slides were obtained by the Congressional Budget Office. You can find these slides and more on their website.

Last Tuesday, House Republicans released a budget plan that would make large cuts to Medicare. The budget plan intends to privatize Medicare ; thereby hoping to eliminate $537 billion out of the program over the next decade. Congress argues that privatization of Medicare will bring down costs.

Seniors eligible for Medicare would receive a voucher rather than a Medicare card. The voucher would be used to purchase private health care plans. Private plans could be more expensive – leaving seniors to either foot the extra bill or change to plans that provided less care or limited the available providers. Either way, the cost-shifting is born by the seniors.

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GOP Presidential candidate, Mitt Romney, created a buzz this weekend with his pick of Republican Congressman, Paul Ryan (R-Wis) as his vice presidential candidate. Rep. Ryan is mostly known for his budget proposal, The Path to Prosperity, submitted as Committee Chair of the House Budget Committee. One key factor in the presidential election will be a Republican proposal to privatize Medicare.

Medicare is one of the most costly and popular Federal programs. It currently covers 48.7 million senior Americans. Ryan has proposed raising the Medicare-eligibility age to 67 and giving retirees the option of buying private healthcare through a Medicare voucher program. The start date for the voucher program kicks in in 2023. However, polling (particularly those in swing states) indicate that voters disapprove of cuts to Medicare as well as attempts to privatize Medicare.

In the meantime the same budget program plans to cut $1.4 trillion in Medicaid benefits between 2013 and 2023. Most of this would occur by repealing the Affordable Care Act and caps on federal spending for Medicaid. The caps on federal spending would occur in the way of block grants to states. States would receive less federal dollars, but would have more flexibility in administering Medicaid eligibility and payments. States would likely have to reduce payments to providers, reduce Medicaid eligibility and/or provide less extensive coverage to beneficiaries. Ryan’s cuts could mean 30 million Medicaid beneficiaries would lose coverage.

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Articles Posted in Medicare

Medicare and Medicaid under the Paul Ryan Budget