The proposed House budget undermines Medicare and Medicaid

In April the House of Representatives passed a budget plan that calls for big cuts in both Medicare and Medicaid – two programs that people who are 65-plus rely on for their health insurance. Here’s what’s at stake if the House budget proposal becomes law:

First, Medicare: Today, Medicare provides guaranteed health benefits to everyone 65 and over who has paid into the system (or whose spouse paid in). Many people with disabilities qualify the same way. Under the House plan, however, no one born after 1956 could get the guaranteed health benefits that Medicare beneficiaries get today.

Instead, starting in 2022, they’d get a voucher to buy coverage from a private insurance company. That voucher would cover less than 40 percent of an average person’s health care costs – with the rest coming out of their pockets. Because the value of the voucher would not keep up with health care costs, each year people would pay more and get less.

People on Medicare today aren’t safe. The House budget proposal reopens the Medicare prescription drug “doughnut hole” that the Affordable Care Act is gradually closing. If it becomes law, nearly 4 million people currently enrolled in Medicare would face higher prescription drug costs this year – costs that will grow to up to $6,000 a year by the end of the decade.

Second, Medicaid: Medicaid is the primary source of coverage for long-term care. It’s the main payer for 64 percent of people in nursing homes, and it covers home-based care for millions of people 65-plus, allowing them to stay in their homes. Medicaid is funded by states and the federal government, but each state runs its own program based on federal guidelines.

The House budget proposal makes $1.4 trillion in cuts to Medicaid over the next 10 years, which would force states to dramatically reduce the coverage they provide. Long-term care services would be slashed, just as large numbers of baby boomers start to need help. The burden of providing this help will fall on families and friends, who will have to take time off work to care for their ailing loved ones.

Although the proposal’s supporters say these are the steps we have to take to bring the deficit under control, the House plan barely nicks the deficit. That’s because, for all the cuts to health care, it expands tax breaks for businesses and wealthy Americans.

We need to deal with our nation’s fiscal problems, but an honest approach starts with making sure everyone pays a fair share and not by dismantling the health insurance that today’s and tomorrow’s elders are counting on.

Additional Reading from Families USA:
Protecting America’s Seniors and People with Disabilities: Why It Is Important to Preserve the Maintenance of Effort Requirement in the Affordable Care Act
Cutting Medicaid: Harming Seniors and People with Disabilities
Medicaid, the Budget, and Deficit Reduction: Keeping Score of the Threats
Health Hazard: How the House Republican Budget Resolution Would Dramatically Change Medicare
What the House Budget Resolution Means for America’s Seniors and People with Disabilities

Ron Pollack is the executive director of Families USA and a proud granddad.

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