Once again providers will bear the brunt of budget cuts. The Obama administration’s FY 2013 budget, released Monday, would cut spending on Medicare and Medicaid by close to $360 billion over the next 10 years, and most of the reduction is to providers and drug companies. Additionally, to compensate for ever-shrinking funds, the Obama administration proposed to raise Medicare premiums for retirees and higher-income seniors beginning in 2017. (Associated Press)
The budget will become even tighter as Baby Boomers begin to retire and the president’s health care reform law kicks in. Someone has to fund Medicaid for the millions more added recipients, and post-retirement health care coverage is looking shaky.
An excerpt from the AP:
Republicans are arguing for deeper spending cuts and a frontal assault on the biggest drivers of the deficit, the soaring costs of Medicare and Medicaid, whose already sizable costs are projected to double in future years as baby boomers retire.
Rep. Paul Ryan, R-Wis., chairman of the House Budget Committee, said Monday that he expected the Republican-controlled House would in coming weeks pass an alternative to the Obama budget that would gain control of the deficit, not by raising taxes but by curtailing Medicare and Medicaid.
“President Obama’s irresponsible budget is a recipe for a debt crisis and the decline of America,” Ryan said.
Obama’s cuts in Medicare and Medicaid avoid cuts in benefits and instead make modest trims in payments to health care providers. In contrast, the Republican House last year approved Ryan’s plan, which would essentially transform Medicare into a voucher system in which future seniors would get a fixed amount to buy medical insurance.