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CBO Targets Health Care in Options for Reducing Deficit

Every year the Congressional Budget Office publishes a menu of options for reducing federal spending and the federal budget deficit.  As in the past, this year’s compendium includes a number of options to reduce federal health care spending and raises federal revenue through health care initiatives.

The cost-cutting options include:

  • establish caps on federal spending for Medicaid
  • limit states’ taxes on health care providers
  • reduce federal Medicaid matching rates
  • change the cost-sharing rules for Medicare and restrict Medigap insurance
  • raise the age of eligibility for Medicare to 67
  • reduce Medicare’s coverage of bad debt
  • consolidate and reduce federal payments for graduate medical education at teaching hospitals
  • use an alternative measure of inflation to index social security and other mandatory programs

Options to raise additional revenue include:

  • increase premiums for Parts B and D of Medicare
  • reduce tax subsidies for employment-based health insurance
  • increase the payroll tax rate for Medicare hospital insurance

Many of these proposals, if implemented, would be damaging for private safety-net hospitals.

Learn more about the CBO’s recommendations, how they might be implemented, and their potential implications in the CBO report Options for Reducing the Deficit: 2019 to 2028.

 

Medicaid in the Spotlight

State-option work requirements.

A cap on federal spending.

New flexibility for states to address eligibility, benefits, and provider payments.

Rolling back the Affordable Care Act’s eligibility expansion.

Medicaid is under the policy microscope in Washington these days in ways it has not been for many years as the new administration continues to work to put its stamp on the federal government’s major program to provide health care to low-income Americans.

These and other possible changes are of great interest to the nation’s private safety-net hospitals because these hospitals care for so many more Medicaid and low-income patients than the typical community hospital.

What are policy-makers considering and what are the potential implications of their efforts?  Learn more in the new Health Affairs blog article “Medicaid Program Under Siege,” which can be found here.