Proposals for Medicaid, Medicare, and Social Security Changes

by Holly Safi
Recently the national debt has received bipartisan attention in Washington. The current federal debt is rising faster than revenue such that, by 2025, revenue may be exhausted each year just to pay interest on debt and to fund Medicare, Medicaid, and Social Security. Two proposals have emerged. Here are some highlights of how each plan would affect some of the programs people with disabilities rely on most:

The House Commission on the Budget “Ryan” Plan, expected savings of $6.2 trillion:
• Medicaid changes to a “block grant” program where each state will receive a set amount of funding based on population growth and inflation. Beginning in 2022, Medicaid will no longer provide acute care for the elderly.
• Medicare changes to a “premium support model” where those eligible would shop a federally-managed exchange of private insurance plans and the government would provide a set grant to the insurer to assist the beneficiary in paying the premium for the plan. In addition, the eligible age for Medicare will increase to 67 by 2033.
• SNAP, SSI, unemployment would be part of a larger group of services that will have funding cut in half by 2021.
• Repeal some provisions of the Affordable Care Act (ACA), including the Medicaid extension and the CLASS Act.
• Increase the Dept. of Defense budget to $692.5 billion ($680 billion in 2010).
• Does not fundamentally change Social Security.

The National Commission on Fiscal Responsibility and Reform Plan , expected savings of $4 trillion:
• Establish a long-term budget for total federal health-care spending, limited to the GDP growth plus 1% each year.
• Place dual eligibles (Medicaid/Medicare) in a Medicaid managed care plan and extend the Medicaid drug rebate to them.
• Establish a single combined annual deductable for Medicare Plan A & B, while restricting Medicare supplemental insurance.
• Keep most of the ACA, except to repeal or reform the CLASS Act
• Lift the cap on taxable income for Social Security and increase the Normal Retirement Age to 68 by 2050, 69 by 2075.
• Repeal the Bush Administration’s tax cuts and reduce the Dept. of Defense budget $400 billion by 2023.
• Does not fundamentally change SNAP, SSI, unemployment.

The Fiscal Commission plan reduces spending in some areas but increases spending in others. The Ryan plan drastically reduces spending, but the Medicaid program that currently provides 60 million Americans with medical care, long-term care, and in-home care for people with disabilities will be cut by $1.4 trillion dollars over 10 years. In North Carolina alone, this could affect 514,000 seniors and people with disabilities on Medicaid, 112,000 direct care workers, and 1.7 million informal caregivers. In addition, Medicare that provides coverage for 47 million seniors and people with disabilities will be cut by $30 billion over a 10 year period. Families USA estimates that 45.6 million children and 7.6 million seniors would lose crucial health care under the Ryan plan.

Read more about the plans at the following links:
The Ryan Plan
The National Commission's Plan
Families USA Special Report
Families USA Special State Report on North Carolina