President Obama released his proposed federal budget yesterday. It is one of several budgets that are proposed on Capitol Hill:
As proposals, none of these proposals are likely to pass without significant amendment, if at all. But the President’s plan is important, since it reflects the President’s position moving forward in these negotiations.
There’s some winners and losers generally in the budget, and some good and bad news in the President’s health budget in specific.
The Affordable Care Act, not surprisingly but importantly, is fully funded. On Medicaid, there’s good news. As Edwin Park of the Center for Budget and Policy Priorities writes, the President has withdrawn previously proposed cuts to Medicaid, and made the commitment that the federal government will pay nearly all the costs of the Medicaid expansion. Some Governors have used the concern that some costs might be shifted to the states as an excuse for going slow on the Medicaid expansion, but this budget, in writing, should give greater comfort that states can proceed with minimal risk.
In fact, the Administration wants to delay scheduled Medicaid cuts to public hospitals. These funds, called DSH (disproportionate share hospital) payments, are scheduled to be cut in the next several years, under the theory that the number of uninsured will be reduced as well. But it makes sense to delay these scheduled cuts to see the evidence on the ground of reduced uninsured and reduced demand on the safety-net.
On Medicare, the response to the President’s budget is more complicated. Ethan Rome of Health Care for America Now writes that “it rightly eliminates a huge government gift to Big Pharma and takes the first steps toward reining in the industry’s statutory power to overcharge Medicare for prescription drugs, a hugely important proposal that could save taxpayers $156 billion.” But that “the bad news is that the president’s budget includes the Republicans’ proposal to cut Social Security benefits. It also would make many seniors pay more for their Medicare.” Ezra Klein at the Washington Post specifies that “the budget proposes a hike in premiums for upper-income seniors enrolled in Medicare Parts B and D. This will raise $50 billion over 10 years.”
We’ll have more analysis over the next several days.