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July 18, 2017

House GOP proposes $500 billion in Medicare cuts over 10 years

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House Republicans on Tuesday released a fiscal year (FY) 2018 budget resolution that calls for transitioning Medicare to a premium support model.

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Overall, the resolution—which serves as a 10-year budget blueprint—aims to balance the federal budget over the next decade and calls for up to $203 billion in spending cuts to various federal programs. House Budget Committee Chair Diane Black (R-Tenn.), who authored the budget blueprint, said the committee will vote on the measure later this week.

The resolution is nonbinding and would serve as a plan for lawmakers to pass appropriations measures via the budget reconciliation process. According to the Washington Post, the resolution is intended to "pave the way" for GOP lawmakers' upcoming effort to overhaul the U.S. tax code.

Health care provisions

The budget resolution calls for transitioning Medicare to a premium support model that has long been championed by some top GOP policymakers. Under such a model, Medicare beneficiaries would receive a fixed amount to purchase health coverage in the private market. According to a summary, the blueprint also would "maintain[n] the option for traditional Medicare."

The resolution—which assumes that the House-passed American Health Care Act (AHCA) and all of its Medicaid reforms, such as allowing  states to implement Medicaid work requirements, will take effect—also calls for nearly $500 billion in spending cuts to Medicare and about $1.5 trillion in spending cuts under Medicaid and other federal health programs over ten years.

According to Axios' "Vitals," the blueprint also calls for medical liability reform.

Some GOP lawmakers already express concerns

Black in a statement said, "The status quo is unsustainable," adding, "A mounting national debt and lackluster economic growth will limit opportunity for people all across the country." She continued, "But we don't have to accept this reality. We can move forward with an optimistic vision for the future and this budget is the first step in that process."

White House Office of Management and Budget Director Mick Mulvaney called the blueprint "a bold effort that follows the leadership of President Trump in making America great again." He added, "The [Trump] administration urges the House Budget Committee, the full House, and the Senate to move forward on a pro-growth budget resolution that supports the administration's goals of a strong national defense, fiscal responsibility, and sustained economic growth."

However, some GOP lawmakers already have expressed concerns about the budget blueprint. For example, House Freedom Caucus Chair Mark Meadows (R-N.C.) on Monday said the proposal should call for deeper spending cuts and said he does not think it would be approved by the House in its current form.

More moderate Republicans, meanwhile, could oppose the steep cuts included in the proposal, the Post reports (Taylor, AP/Sacramento Bee, 7/18; DeBonis, Washington Post, 7/18; Rappeport, New York Times, 7/18; Budget blueprint summary, accessed 7/18; Nather/Baker, "Vitals," Axios, 7/18).

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