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Make no cuts to Medicare

"I'm not going to cut Social Security like every other Republican and I'k non going to cut Medicare or Medicaid."

Trump-O-Meter

Democrats say latest Trump budget cuts Medicare, but information technology's not that uncomplicated

Democrats didn't look long after President Donald Trump unveiled his budget for 2020 to call him out for cutting Medicare, a programme he promised to go out untouched.

"The Trump administration wants to cut hundreds of billions of dollars from the #Medicare budget, all while giving billionaires and behemothic corporations huge tax breaks with the #GOPTaxScam," tweeted Democratic presidential candidate Elizabeth Warren, D-Mass., on March 12.

Autonomous Hawaii Sen. Brian Schatz talked of $845 billion in cuts over the side by side ten years.

'It's right there in the budget that the president released this week," Schatz said.

Reading the summary table in the budget, Schatz has a indicate.

The administration projects Medicare spending that is $846 billion less than what the government would have spent if everything stayed on the aforementioned path it'south on today.

Whether that's a cut is a more hard question. While Democrats criticize Trump for cutting Medicare, President Barack Obama regularly offered his own version of steps to rein in the growth of Medicare. In his concluding upkeep, Obama proposed trimming spending by about $420 billion over 10 years. (Republicans accused Obama and Democrats of cutting Medicare many times, a claim we never rated meliorate than Half True.)

The reality is, spending rises every yr in Trump'due south budget, except for the last i in 2029 (which is mainly a fluke of timing related to when Medicare pays its bills).

To complicate things more, that $846 billion isn't what it appears to be. Two hefty pieces of Medicare — actress payments to hospitals that serve a lot of uninsured patients and funds for pedagogy hospitals — were moved out of Medicare and into the regular full general fund budget. In that location were cuts, merely not nearly as much as the Medicare line items would suggest.

Adding those dollars back reduces the total reduction to $595 billion for Medicare.

But is that actually a cut?

"This outcome has been effectually for decades," said Tricia Neuman, the Kaiser Family Foundation's Medicare policy manager. "Information technology is a proposed reduction relative to the baseline. A cut sounds worse than a reduction, only the effect is the same. If these proposals were adopted, there would exist less coin paid to providers for specific Medicare services than there would accept been."

Most of the proposed changes target payments to hospitals and other providers — and that might not bear on Medicare patients.

Neuman and many other researchers and analysts believe in that location is room to spend less without pain recipients.

"In general, these proposals are in areas where there is evidence we pay providers too much," said Matthew Fiedler, at the Brookings Institution Middle for Health Policy. "Ane large proposal is to brand payments site-neutral. Currently, we oft pay more for the same service when it's delivered in a hospital rather than in a doc'due south office, even when in that location's no evidence the site of service makes a difference."

Two of the plans along these lines would relieve a combined $160 billion, according to the Health and Human Services Department.

In 2009, researchers at the Dartmouth Eye for Health Policy and Clinical Practise reported that "College spending does not consequence in meliorate quality of care, whether one looks at the technical quality and reliability of hospital or ambulatory care, or survival post-obit such serious conditions every bit a heart attack or hip fracture."

It's important to notation that not all of the proposed cuts land on providers.

Neuman pointed to changes in Medicare's Part D prescription drug insurance program that direct touch on recipients. While 1 change would cap out-of-pocket costs for people with the very highest drug costs, another would expose people beneath that cost level to higher fees. At the end of the day, the Trump budget reduces payments for people who rely on prescription drugs past $50 billion.

Those $50 billion might be the clearest instance of Medicare cuts in the Trump budget. The remaining $545 billion potentially could be captivated by providers.

With Democrats running the House, Trump's budget has no chance of passage. That's typical for any presidential upkeep, and it'southward particularly true for this one.

Every bit an expression of policy priorities, this budget largely resembles past efforts to control the growth of Medicare spending by targeting provider payments. We go on to rate this hope as a Compromise.

White House, A Budget for a Better America, March 11, 2019

US. Health and Homo Services Section, FY 2020 Upkeep in brief, March 11, 2019

Congressional Upkeep Office, Medicare—CBO's Apr 2018 Baseline, Apr 2018

White House, FY 2017 Budget, Feb. ix, 2016

Medicare Payment Informational Commission, Medicare payment policy, March 2019

Medicare Payment Advisory Committee, Report to the Congress: Medicare and the Wellness Care Delivery System, June 2018

Office of Management and Budget, Fiscal Year 2016 budget, February. two, 2015

Centers for Medicare and Medicaid Services, CMS Office of the Actuary releases 2018-2027 Projections of National Health Expenditures, Feb. 20, 2019

Centers for Medicare and Medicaid Services, Projected Medicare Expenditures under an Illustrative Scenario with Alternative Payment Updates to Medicare Providers, June 5, 2018

Committee for a Responsible Federal Budget, Analysis of the President'south FY 2020 Budget, March 11, 2019

Dartmouth Centre for Wellness Policy and Clinical Do, Health Intendance Spending, Quality, and Outcomes, Feb. 27, 2009

PolitiFact, GOP ad says Bruce Braley 'voted to cut $700 billion from Medicare to support Obamacare', Sept. 9, 2014

Washington Post, Democrats engage in 'Mediscare' spin on the Trump budget, March 15, 2019

Interview, Matthew Fiedler, fellow, Eye for Health Policy, Brookings Establishment, March eighteen, 2019

Interview, Tricia Neuman, senior vice president, director, Program on Medicare Policy, Kaiser Family Foundation, March nineteen, 2019

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No service cuts only the trust fund took a striking

Protecting Medicare was was one of Trump'due south earliest campaign pledges. "Save Medicare, Medicaid and Social Security without cuts. Have to practice information technology," he said in his presidential campaign announcement voice communication.

And so far, the hope of Medicare remains in force. At that place have been no cuts in services or a change in the regime's responsibility to fund the program.

That said, Medicare'southward resource to pay for those services has shrunk, and both Trump and House Republicans take proposed ways to trim Medicare spending over the adjacent decade.

On the resources side, a side effect of the Republican 2017 Taxation Cut and Jobs Act was a loss of tax dollars flowing into Medicare's Hospital Insurance Trust Fund. That'south the main pot of Medicare coin, and the Medicare Trustees forecast in their 2018 report that the fund would run out of money in 2026. A year earlier, they said it would last until 2029.

On Trump's lookout man, it lost three years of solvency.

In a presentation at the American Enterprise Plant, a market-oriented think tank, the primary actuary at the Centers for Medicare and Medicaid Services, Paul Spitalnic, said two of the lost years were due to lower than expected wage growth.

Merely the other lost year came from the Republican tax cuts.

"The Tax Cuts and Jobs Human activity of 2017 decreased individual taxation rates and every bit a result, at that place is somewhat less income coming into the trust fund," Spitalnic said. "That does accept an effect of making depletion of the trust fund a year earlier."

Critics of this assay counter that the Medicare actuaries fabricated some poor assumptions in 2017, which fabricated 2018 look worse than it actually was. On the other hand, both parties have relied on the trustees' forecast for decades.

In terms of budgets, the White House FY 2019 budget program proposed reducing the growth of Medicare to generate $236 billion in savings by 2028. The administration said it would save coin through amend negotiations on drugs, shifting some payments abroad from the trust fund and reducing Medicare fraud.

The House Republicans had their own packet of changes that they said would trim spending by $537 billion by 2028.

As e'er, the debate is whether slowing the growth of Medicare is the aforementioned as cut it. Simply the Firm proposal would make real cuts. It raised the eligibility historic period from 65 to 67, and increased deductibles. It besides turned Medicare into a voucher program. When the Congressional Upkeep Office scored a similar proposal, it found that people using traditional Medicare would finish upwardly paying more.

Even so, neither Trump'south nor the House Republican plans became law.

For now, benefits remain as they were, but there has been a modest impact on funding that could affect the program in the future.

We rate this equally a Compromise.

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No cuts to Medicare enacted yet

As a presidential candidate, Donald Trump pledged that he wouldn't cut Medicare, the federal health-care program that mainly serves Americans 65 and older.

So far, cipher has been enacted on Trump's picket that cuts Medicare benefits, said Erin A. Taylor, a policy researcher at the RAND Corp. "To my noesis at that place has been no actual policy enacted notwithstanding during the Trump administration that would cut Medicare funding in such a way every bit to have meaning impact on beneficiaries," she said.

Nevertheless, Trump did offer a number of ideas for overhauling pieces of Medicare in his fiscal year 2019 upkeep proposal. Some, Taylor said, could exit Medicare beneficiaries better off, while some might not; it is hard to say at this time whether the gains for beneficiaries would outweigh the losses.

Over 10 years, Trump's 2019 budget proposal says information technology would cut Medicare spending by a cumulative $236 billion, including past reductions in "waste" and "fraud" and past irresolute the style drugs are priced and paid for in the program.

The largest cuts, Taylor said, would come from reducing Medicare's payments for uncompensated care in hospitals and from irresolute payments for graduate medical education. But "the effects of these changes may trickle down to beneficiaries in terms of changes in sites of service or effects on incentives on the parts of hospitals to provide care, but those effects may not exist negative," Taylor said.

The changes to the Medicare Part D drug program would take a more direct touch on on beneficiaries, though information technology's hard to tell how exactly the changes might flow through the organisation.

"On the positive side, requiring Medicare plans to pass through a proportion of manufacturer rebates to beneficiaries at the pharmacy could serve to reduce costs for beneficiaries," Taylor said, though she added that the organisation would be technically difficult to implement.

On the other hand, she said, the budget proposes not to count those cost reductions towards the adding of the casher's out-of-pocket spending. This ways it would accept beneficiaries longer to reach the catastrophic phase of the benefit.

Another possible benefit, at least for those with very high drug costs, is that those who achieve the catastrophic stage would pay nothing for their prescriptions for the rest of the year, as opposed to the 5 percent share they would pay currently.

The budget also proposes to eliminate generic-drug price sharing for low-income subsidy beneficiaries; this increases the government's cost brunt, merely it could encourage these beneficiaries to take needed medications, Taylor said.

A final potential negative: The upkeep proposes to reduce the number of drugs required to exist covered on plan formularies. This could restrict the power of beneficiaries to admission the medicines they need, and may require them to go through an appeals process to gain coverage.

The budget proposal does phone call for $236 billion in Medicare reductions, which would contradict Trump'due south campaign promise. On the other hand, the budget proposal is a non-binding document, it includes some provisions that would benefit users of Medicare, and more than a year into Trump's presidency, nothing has been enacted that is opposite to his promise not to cut Medicare. And then nosotros rate the promise In the Works.

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Hereafter of Medicare funding uncertain under Trump presidency

President Donald Trump's vow to save Medicare from budget cuts is facing a snag every bit the 2018 budget makes its mode through Congress.

The hope, along with maintaining current funding levels for other entitlement programs, was one of Trump's primeval campaign pledges. "Salve Medicare, Medicaid and Social Security without cuts. Accept to practice it," he said in his presidential announcement speech.

The 2018 White House upkeep proposal released in May left Medicare benefits largely untouched compared with Medicaid, which would see a more than than $600 billion decrease over x years compared to electric current spending levels. Notwithstanding, Medicare spending would decrease by more than $50 billion in the adjacent decade compared with current levels.

Though the proposed upkeep doesn't spell out large direct cuts to Medicare, cuts to other programs would indirectly impact the senior wellness insurance program. For instance, the upkeep included eliminating the State Wellness Insurance Assistance Program, which provides Medicare beneficiaries with counseling and assistance to navigate the wellness care system.

Still, those cuts won't necessarily happen because the White House budget proposal is more of a wish list that the president gives to Congress, where both the House of Representatives and the Senate must create and agree on a final upkeep to be signed by the president.

The House's electric current budget resolution, which was released in July, asked to cut Medicare past $487 billion between 2018 and 2027. Much of this would exist done by turning Medicare into a voucher-similar program, increasing income-related premiums and limiting medical malpractice litigation by capping attorney fees and awards, according to the plan.

Again, that $487 billion cut won't necessarily make information technology into the concluding budget, especially since the House resolution currently doesn't comprise legal language that would help ensure the full cut through a special legislative procedure chosen reconciliation.

Even though the budget resolution has a line that calls for reduced Medicare spending, it doesn't actually include a fashion to make that happen, said Marc Goldwein, the senior vice president of the Committee for a Responsible Federal Budget. He said Congress could terminate up making some moderate cuts to Medicare this twelvemonth, but "they're conspicuously non prioritizing it."

Congress and the White House must concur on a upkeep earlier Oct. 1 or pass a continuing resolution to avoid a regime shutdown during upkeep negotiations.

But even if Medicare doesn't undergo cuts in the adjacent budget, it's still possible that the program could be affected by an Obamacare repeal or replacement.

"Information technology's unclear given the uncertainty surrounding dealings in Washington right now," said David Lipschutz, an attorney with the Center for Medicare Advocacy. "But we are certainly not out of the woods."

An effort to repeal portions of the health intendance law died on the Senate floor on July 28 when Republican Sen. John McCain voted confronting it, but that hasn't stopped the GOP from trying again. Another Obamacare partial repeal proposal past Sens. Nib Cassidy, R-La,, Lindsey Graham, R-S.C., and Dean Heller, R-Nev., has the support of McCain and Trump, co-ordinate to printing reports.

A process that temporarily allowed health intendance legislation to advance in the Senate with 50 votes rather than the usual 60 votes -- Republicans' best chance at passing a wellness care bill -- will terminate on Sept.xxx.

Lipschutz said the upcoming borderline could pressure Republicans to hastily laissez passer legislation on health care.

If a new fractional repeal looks anything like by efforts to change health intendance, Medicare would likely exist affected by cuts to Medicaid spending, ane-3rd of which goes to low-income seniors who are enrolled in both Medicare and Medicaid. (The Congressional Budget Office projected over $800 billion in cuts to Medicaid by 2026 in its analysis of the Obamacare Repeal Reconciliation Human action of 2017.) The Commonwealth Fund calculated that, under the previous repeal bill, around 11 million Medicare beneficiaries would lose coverage for long-term services nether Medicaid, such every bit nursing habitation care.

Our ruling

The overall change to Medicare spending volition depend on what makes it into the final 2018 budget and what happens with Obamacare. Simply current legislative proposals, some of which have garnered Trump's support, program for funding cuts that bear upon Medicare in some way, whether directly or indirectly. Trump has not signed either into police yet, and so for now we rate this hope Stalled.

Congressional Budget Office, Obamacare Repeal Reconciliation Act of 2017 toll estimate, July 19, 2017

U.Southward. House of Representatives, 2018 spending program blueprint, July xix, 2017

The White Firm, 2018 budget proposal, May 23, 2017

Office of Sen. Bill Cassidy, press release, Sept. 12, 2017

The Republic Fund, "AHCA Would Impact Medicare, Too," May 17, 2017

Donald Trump entrada website, re-create of interview with The Daily Signal, "Why Donald Trump Won't Bear on Your Entitlements," screengrab from January. 28, 2017

Fourth dimension, "Hither's Donald Trump'south Presidential Declaration Voice communication," June sixteen, 2015

USA Today, "Senate narrowly defeats 'skinny repeal' of Obamacare, as McCain votes 'no,'" July 28, 2017

The Colina, "McCain backs Graham-Cassidy Obamacare repeal effort," Sept. 9, 2017

Political leader, "Trump wants one concluding Senate push on Obamacare repeal," Sept. 5, 2017

Los Angeles Times, "Republicans face Sept. xxx deadline for fast-track Obamacare repeal," Sept. ane, 2017

Phone interview with David Lipschutz, an attorney with the Middle for Medicare Advocacy, Sept. 12, 2017

Phone interview with Marc Goldwein, the Senior Vice President of the Commission for a Responsible Federal Budget, Sept. 12, 2017

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