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Senior Citizen Politics
Obama Budget Plan Cuts Deficit by $4 Trillion,
Strengthens Medicare, Medicaid, Social Security
Around two-thirds of budget is
spent on Medicare, Medicaid, Social Security, and national security -
April 13, 2011 - President Barack Obama on
Wednesday shared his plans to cut the deficit by $4 trillion in 12
years, which, according to a fact sheet distributed by the White House,
includes saving $480 billion in health care costs by 2023. Obama
proposes holding Medicare cost growth down by strengthening the
Independent Payment Advisory Board and making Medicaid more flexible
without using block grants.
And, about the other program vital to senior citizens,
Social Security, his fact sheet said, “No current beneficiary should see
the basic benefit reduced; nor will we accept an approach that slashes
benefits for future generations.”
Medicare and Medicaid received a considerable
amount of attention in the President’s remarks and fact sheets handed
out by the White House staff. Social Security, too, received
The President said he will preserve Medicare and
Medicaid and will not allow Medicare to “become a voucher program that
leaves seniors at the mercy of the insurance industry, with a shrinking
benefit to pay for rising costs.”
He said he will “slow the growth of Medicare costs
by strengthening an independent commission of doctors, nurses, medical
experts and consumers who will look at all the evidence and recommend
the best ways to reduce unnecessary spending while protecting access to
the services seniors need.”
In the speech he also said, “Part of this American
belief that we are all connected also expresses itself in a conviction
that each one of us deserves some basic measure of security. We
recognize that no matter how responsibly we live our lives, hard times
or bad luck, a crippling illness or a layoff, may strike any one of us.
GOP Plan Replaces Medicare’s Guaranteed Benefits
with ‘Premium Support’ Payment
Budget does not address root of high Medicare costs
-rising costs in the entire health care sector
By Joe Baker, President, Medicare Rights Center
April 5, 2011
Are Targets in GOP's 'Path to
Prosperity' That Shifts More Costs to Seniors
Democrats say it cuts medical care to the “most
April 5, 2011
Understanding Rep. Ryan's Plan for Medicare Based on
September poll found 69 percent of senior citizens
- people older than 65 - opposed vouchers for Medicare - see video
By Kaiser Health News Staff
- April 5, 2011
Politics Heat Up In Response to GOP Budget's
Medicare, Medicaid Proposals
risk', 'little chance', 'converts Medicare to
premium support program', 'you'll need to pay a
April 5, 2011
Proposals on Medicare Could Shift Costs to Senior Citizens, other
This is week when Republicans show their hand for cutting
Medicare, Medicaid; yesterday House Budget Chairman Paul Ryan (R-Wis) gave
a glimpse of what's to come; GOP hits elderly in states, too
Republicans Also Slash States' Spending on Elderly
AARP Says Texas
Agnes Carey, Kaiser Health News Staff Writer
April 4, 2011
Politics for Senior Citizens
“’There but for the grace of God go I,’ we say to
ourselves, and so we contribute to programs like Medicare and Social
Security, which guarantee us health care and a measure of basic income
after a lifetime of hard work; unemployment insurance, which protects us
against unexpected job loss; and Medicaid, which provides care for
millions of seniors in nursing homes, poor children, and those with
disabilities. We are a better country because of these commitments. I’ll
go further – we would not be a great country without those commitments.
‘So here’s the truth. Around two-thirds of our
budget is spent on Medicare, Medicaid, Social Security, and national
security. Programs like unemployment insurance, student loans, veterans’
benefits, and tax credits for working families take up another 20%.
What’s left, after interest on the debt, is just 12 percent for
everything else. That’s 12 percent for all of our other national
priorities like education and clean energy; medical research and
transportation; food safety and keeping our air and water clean.”
In comparing his proposal for Medicare and Medicaid
to the Republican plan, he said, “… (The Republican plan is) a vision
that says America can’t afford to keep the promise we’ve made to care
for our seniors. It says that ten years from now, if you’re a 65 year
old who’s eligible for Medicare, you should have to pay nearly $6,400
more than you would today. It says instead of guaranteed health care,
you will get a voucher. And if that voucher isn’t worth enough to buy
insurance, tough luck – you’re on your own. Put simply, it ends Medicare
as we know it.
This is a vision that says up to 50 million
Americans have to lose their health insurance in order for us to reduce
the deficit. And who are those 50 million Americans? Many are someone’s
grandparents who wouldn’t be able afford nursing home care without
Medicaid. Many are poor children. Some are middle-class families who
have children with autism or Down’s syndrome. Some are kids with
disabilities so severe that they require 24-hour care. These are the
Americans we’d be telling to fend for themselves.
…The third step in our approach is to further
reduce health care spending in our budget. Here, the difference with the
House Republican plan could not be clearer: their plan lowers the
government’s health care bills by asking seniors and poor families to
pay them instead. Our approach lowers the government’s health care bills
by reducing the cost of health care itself.
Here's a look at the health care section of the
fact sheet, as released by the White House:
Details of the President’s Framework for Shared
Prosperity and Shared Fiscal Responsibility
● Medicare and Medicaid Savings of $480 Billion by 2023 and At Least
an Additional $1 Trillion over the Subsequent Decade, Providing Better
Care at Lower Costs:
● Building on the Affordable Care Act, the President is proposing
additional reforms to Medicare and Medicaid designed to strengthen these
critical programs by reducing waste, increasing accountability,
promoting efficiency, and improving the quality of care, without
shifting the cost of care to our seniors or people with disabilities.
● The framework will save $340 billion over ten years and $480
billion by 2023 (including the proposals already included in the
President’s Budget). This framework includes the same aggregate savings
that House Budget Committee Chairman Paul Ryan proposed in his November
2010 plan with Alice Rivlin and an amount sufficient to fully pay to
reform the Medicare Sustainable Growth Rate (SGR) physician payment
formula while still reducing the deficit.
● Over the subsequent decade, the President’s proposal will save well
over $1 trillion by further bending the cost curve, doubling the savings
from the Affordable Care Act.
● The President’s framework offers a stark contrast with the House
Republican plan that would increase seniors’ health costs by $6,400
annually starting in 2022, raise health insurance premiums for
middle-class Americans and small businesses, cut Federal Medicaid
spending by one-third by the end of the decade, and increase the number
of uninsured by 50 million.
● The President’s framework proposes specific reforms to strengthen
Medicare and Medicaid over the long term, including:
● Addressing the long-term drivers of Medicare cost growth: The
President’s framework would strengthen the Independent Payment Advisory
Board (IPAB) created by the Affordable Care Act. The IPAB has been
highlighted by economists and health policy experts as a critical
contributor to Medicare’s solvency and sound operations. Under the
Affordable Care Act, IPAB analyzes the drivers of excessive and
unnecessary Medicare cost growth. When Medicare growth per beneficiary
exceeds growth in nominal GDP per capita plus 1 percent, IPAB recommends
to Congress policies to reduce the rate of growth to meet that target,
while not harming beneficiaries’ access to needed services. Congress
must consider IPAB’s recommendations or, if it disagrees, enact policies
that achieve equivalent savings. If neither acts, then the Secretary of
Health and Human Services would have to develop and implement a proposal
to achieve the savings target.
● The President’s framework will strengthen IPAB to act as a backstop
to the other Medicare reforms by ensuring that Medicare spending growth
does not outpace our ability to pay for it over the long run, while
improving the program and keeping Medicare beneficiaries’ premium growth
under control. Specifically, it would:
● Set a new target of Medicare growth per beneficiary growing with
GDP per capita plus 0.5 percent. This is consistent both with the
reductions in projected Medicare spending since the Affordable Care Act
was passed and the additional reforms the President is proposing.
● Give IPAB additional tools to improve the quality of care while
reducing costs, including allowing it to promote value-based benefit
designs that promote proven services like prevention without shifting
costs to seniors.
● Give IPAB additional enforcement mechanisms such as an automatic
sequester as a backstop for IPAB, Congress, and the Secretary of Health
and Human Services.
● Reforming the Federal-State partnerships to strengthen Medicaid and
promote simplicity, efficiency, and accountability: Under current law,
States face a patchwork of different Federal payment contributions for
Medicaid and the Children’s Health Insurance Program (CHIP). The
President’s framework would replace the current complicated Federal
matching formulas with a single matching rate for all program spending
that rewards States for efficiency and automatically increases if a
recession forces enrollment and State costs to rise.
● In addition, the President has called on the National Governors
Association (NGA) to make recommendations for ways to reform and
strengthen Medicaid, and the framework will consider the ideas that its
Task Force produces. The President also supports reform of Medicaid to
incentivize more efficient, higher quality, care for high-cost
beneficiaries, including those who are eligible for both Medicaid and
Medicare. These nine million beneficiaries comprise 15 percent of
Medicaid enrollment but consume nearly 40 percent of total Medicaid
● Improving patient safety: Together with employers, States,
hospitals, physicians and nurses, the Administration has launched a new
public-private partnership called Partnership for Patients that will
help improve the quality, safety and affordability of health care for
all Americans. The two goals of this new Partnership are: preventing
patients from getting injured or sicker while they are in the hospital
and helping patients heal without complication. Achieving the
initiative’s goal would mean more than 1.6 million patients will recover
from illness without a preventable complication, reducing costs by up to
$50 billion in Medicare and billions more in Medicaid over the next 10
● Cutting unnecessary prescription drug spending: The framework would
limit excessive payments for prescription drugs by leveraging Medicare’s
purchasing power – similar to what was called for by the bipartisan
Fiscal Commission. It would speed up the availability of generic
biologics, and prohibit brand-name companies from entering into “pay for
delay” agreements with generic companies. And, it would implement
Medicaid management of high prescribers and users of prescription drugs.
● Reducing abuse and increasing accountability in Medicaid and
Medicare: The framework would clamp down on States’ use of provider
taxes to lower their own spending while not providing additional health
services through Medicaid; recover erroneous payments from Medicare
Advantage; establish upper limits on Medicaid payments for durable
medical equipment; and take other actions to improve program integrity.
● A major contrast with the House Republican approach. The
President’s framework rejects plans that would end Medicare as we know
it or transform Medicaid into a dramatically underfunded block grant,
putting at serious risk not only seniors but also the most vulnerable
children and people with disabilities. Some of the major problems with
the House Republican approach include:
● The House Republican plan does nothing to reduce health costs.
Instead it actually increases costs by doing nothing to reform the way
health care is delivered in addition to putting a larger fraction of the
burden on beneficiaries and States.
● In the first year the Republican plan goes into effect, a typical
65-year-old who becomes eligible for Medicare would pay an extra $6,400
for health care, more than doubling what he or she would pay if the plan
were not adopted.
● States would get one-third less for Medicaid by 2021, potentially
leaving 15 million people without coverage, including seniors in nursing
homes, people with disabilities, children and pregnant women.
● The House Republican plan would no longer guarantee the same level
of benefits and choices that seniors have today in Medicare, because the
proposal allows private health plans to determine benefits, raise cost
sharing, and limit choice of doctors and hospitals.
Social Security Details
The President does not believe that Social Security is a driver of our
near-term deficit problems or is currently in crisis. But he supports
bipartisan efforts to strengthen Social Security for the long haul,
because its long-term challenges are better addressed sooner than later
to ensure that it remains the rock-solid benefit for older Americans
that it has been for past generations. The President in the State of the
Union laid out his principles for Social Security reform which he
believes should form the basis for bipartisan negotiations that could
proceed in parallel to deficit negotiations:
● Strengthen retirement security for the low-income and vulnerable;
maintain robust disability and survivors’ benefits.
● No privatization or weakening of the Social Security system; reform
must strengthen Social Security and restore long-term solvency.
● No current beneficiary should see the basic benefit reduced; nor
will we accept an approach that slashes benefits for future generations.
information is reprinted from
kaiserhealthnews.org with permission from the Henry J.
Kaiser Family Foundation. You can view the entire Kaiser
Daily Health Policy Report, search the archives and sign up
for email delivery. © Henry J. Kaiser Family Foundation. All
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