Biden Assault on Republicans’ Medicare Positions Belies Reality of Reform Landscape

As is typical for Washington, the parties appear to be talking one game and playing another.

Jacquelyn Martin, pool
President Biden delivers the State of the Union address on February 7, 2023. Jacquelyn Martin, pool

President Biden’s road show this week aimed at shaming GOP congressional members over proposed Medicare cuts has landed many notable sound bites, but has offered few details on the sustainability of the nation’s health insurance plan for seniors.

Since his State of the Union address Tuesday, the president has traveled to Wisconsin and Florida, home to Republican senators who have expressed misgivings about the current health of the health care program.

“I know that for a lot of Republicans, the dream is to cut Social Security and Medicare. Well let me say this, if that’s your dream, I’m your nightmare,” the president said Thursday in Tampa. 

Surrounded by posters that read, “Protect and Strengthen Medicare,” Mr. Biden said he will hobble any effort to cut entitlements. 

“I don’t know who they think they are,” Mr. Biden said. “I guarantee you, it will not happen. I will veto it.”

As is typical for Washington, though, the parties appear to be talking one game and playing another. 

“Medicare gets cut pretty much every single year in some way or another,” a senior fellow at the Manhattan Institute, Chris Pope, said. “Since the outset, Medicare has been constantly pruned back.”

Republicans booed Mr. Biden on Tuesday night during the State of the Union address for suggesting that they want to kill Social Security and Medicare. Nonetheless, several House Republicans had floated the idea that reforms to the entitlement programs be included in any discussion over dealing with the impending breach of the debt ceiling. 

Not all Republicans are on board with the idea. Senator Hawley of Missouri and Representative John James of Michigan introduced legislation directing the Department of the Treasury to issue Medicare and Social Security payments regardless of whether the debt limit is reached. 

Yet as official figures show a marked upward trajectory in Medicare spending in the coming years, lawmakers must weigh whether they need a full system overhaul or only modest adjustments to avoid Medicare gobbling up an ever larger piece of the federal budget pie.

“The longer we put off the discussion, the harder it’s going to be to come up with solutions,” the deputy director of the program on Medicare policy at the health care policy think tank KFF, Juliette Cubanski, said.

Medicare makes up 10.1 percent of the federal budget. By comparison, Social Security eats up 17 percent of the budget while defense spending consumes 11 percent. On its current trajectory, the Congressional Budget Office predicts that Medicare payments will make up 17.8 percent of the total U.S. budget by 2031.

During that time, Medicare spending is expected to increase to $1.8 trillion from $829 billion, due in part to the large number of Americans who will reach age 65 and rising health care costs. 

Left untouched, Medicare will move to 4.3 percent of GDP from 3.1 percent by 2031, according to the Congressional Budget Office.  By 2052, that number could reach 5.9 percent of GDP. 

Whether that’s sustainable “depends on where you stand,” Ms. Cubanski said.

“I don’t think it’s in anybody’s interest to have the Medicare program consume the entire federal budget, obviously. But the fact is we have a growing older population that needs medical care and we have this Medicare program that has been set up to provide that support,” Ms. Cubanski told the Sun.

With a lack of specificity, lawmakers can argue all day long that they are protecting benefits or slashing costs. Mr. Biden emphasized this week that the so-called Inflation Reduction Act Democrats passed last year saved $237 billion for Medicare by renegotiating prescription costs with drug companies.

Ms. Cubanski said that’s not necessarily a spending cut as much as it is a savings on future spending. 

Reduction in the speed of growth is as good as a cut, Mr. Pope noted, saying Congress has been slashing Medicare by a thousand little cuts for decades. 

“There’s been a lot of quiet entitlement reform over the past 40 years, and there have been a lot of cuts, and they’ve actually been quite acceptable politically to Americans for the most part,” he said. 

So does Houston have a problem or doesn’t it?

The National Debt Clock lists Medicare and Medicaid as the biggest drivers of the nation’s debt, with Social Security in second and defense spending in third at half the pace of Medicare and Medicaid. 

Cutting the rate of growth would provide hundreds of billions of dollars for lawmakers to spend on other programs or to use on tax cuts or deficit reduction, Mr. Pope said, adding that as recently as 2010, the budget office overestimated Medicare spending in 2022 by $200 billion more than it actually was.  

“The program actually is quite capable of being cut. It’s just no one really boasts about it when they do it,” he said.

The New York Sun

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