GOP deficit plan gone ...

... but cuts to Medi­care, Med­i­caid likely to stay

Modern Healthcare - - The Week In Healthcare - Rich Daly

Af­ter the de­feat of a Repub­li­can plan to cut fed­eral deficits with con­tro­ver­sial Medi­care and Med­i­caid changes, some con­gres­sional Democrats claimed cuts to those pro­grams are now off the ta­ble. Not likely, said health­care provider groups. They agreed that Democrats suc­ceeded in har­ness­ing the pub­lic’s queasi­ness with Repub­li­cans’ pro­posed Medi­care changes. But they doubted that a fi­nal deal to re­duce the grow­ing and his­tor­i­cally mas­sive an­nual fed­eral deficits, which will reach about $1.5 tril­lion this year, will not in­clude Medi­care changes.

That ex­pec­ta­tion for even­tual cuts to Medi­care, as well as Med­i­caid, stems from the math­e­mat­i­cal re­al­ity of the pro­grams’ size— 23% of the $3.5 tril­lion fed­eral bud­get in fis­cal 2010, ac­cord­ing to the Con­gres­sional Bud­get Of­fice—and the size of the an­nual deficit.

“Over the long term, providers are go­ing to have to re­main very en­gaged in this,” Michael Regier, se­nior vice pres­i­dent of legal and cor­po­rate af­fairs at VHA, said in an in­ter­view. “That’s be­cause the size of the bud­get deficit means they will have to in­clude Medi­care.”

Se­nate Democrats and five Repub­li­cans joined forces to de­feat the Ryan bud­get May 25, in large part be­cause it would al­low cuts in Medi­care spend­ing by even­tu­ally trans­form­ing it into a sys­tem of pri­vate in­surance pre­mium sub­si­dies. The Se­nate vote came the day af­ter the Demo­cratic can­di­date in a

AP PHOTO

Reid, who spoke to re­porters af­ter a bud­get vote last week, says the Se­nate sent a “strong mes­sage” to Repub­li­cans.

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