WASHINGTON - Ways and Means Ranking Member Sander Levin (D-MI) and Health Subcommittee Ranking Member Jim McDermott (D-WA) today responded to the release of the 2013 Medicare Trustees Report and 2013 Social Security Trustees Report.
The Medicare report projects a further extension of Medicare solvency. The 2013 Medicare Trustees’ Report projects a solvency date of 2026, a two-year improvement from last year’s report. The Republican agenda to repeal the ACA would turn the program in the wrong direction. The Medicare actuaries projected last year that repeal of the ACA would shorten solvency by eight years. For a summary of the solvency projections in past Trustees Reports, click here and for background on the Medicare Trust Funds, click here.
The Social Security Trustees report showed little change from last year’s report.
Ranking Member Levin: “Today’s Medicare Trustees report confirms what we have known for several years now: health reform has extended Medicare solvency and the program is stable. While we have made significant progress to improve the solvency of the Medicare program, we must keep looking for ways to improve and strengthen the program. We will continue to reject any efforts by House Republicans to use this report as justification to repeal the Affordable Care Act or to dramatically raise beneficiary cost-sharing, convert the program to a voucher, or otherwise undermine its promise to our nation’s seniors and those living with disabilities. The Social Security Trustees report shows that the Social Security program remains strong. In the long term, Social Security faces a manageable challenge, one we must address while maintaining Social Security as a foundation of basic security for the millions of current and future seniors, disabled workers, and children who need it. The report also highlights the importance of continuing to focus on growing our economy, as more people working and paying into Social Security means more economic security for all Americans."
Health Subcommittee Ranking Member McDermott: “Today’s Medicare Trustees report demonstrates that the Medicare program is on stable ground and its outlook is improving, thanks in large part to the savings generated in the Affordable Care Act. With Medicare per capita cost growth at record lows and four annual reports confirming that health reform substantially extends solvency, perhaps my Republican colleagues will finally retire their stale repeal agenda. Now is the time to seize the opportunity to continue strengthening Medicare without shifting costs to the elderly and people with disabilities."
Key Takeaways from the 2013 Medicare Trustees Report
The Affordable Care Act Substantially Improved Medicare’s Solvency. The 2013 Medicare Trustees Report projects a solvency date of 2026, a two-year improvement from last year. In sharp contrast, the Republican agenda to repeal the ACA would slash years from the program’s solvency, accelerating the date of insolvency by eight years according to estimates prepared by the Office of the Chief Actuary last year. The ACA took many steps to strengthen Medicare’s fiscal outlook, including removing overpayments to private Medicare Advantage plans, improving provider payment accuracy, encouraging better coordination of care to minimize duplication of tests and improve outcomes, and empowering CMS with new tools to fight health care fraud.
Strengthened Long-Term Fiscal Situation Thanks to Reform. Medicare’s long-term 75-year deficit is also dramatically improved, dropping from 3.88 percent before ACA’s enactment to 1.11 percent now - this means that the 75-year deficit can be closed with revenue increases or spending cuts (or a combination thereof) equivalent to a 1.11 percent increase in the payroll tax. This improvement in the program’s financial outlook is due to lower projected spending for services such as skilled nursing facilities, lower Medicare Advantage spending thanks to the ACA, and technical refinements. Again, in sharp contrast, the Republican agenda to repeal the ACA would dramatically worsen Medicare’s finances. While updated numbers are not yet available, the Medicare actuaries projected last year that if the ACA were repealed, eliminating the 75-year deficit would require a more than doubling of the payroll tax from 2.90-percent to 6.33 percent, or a significant reduction in expenditures.
House Republicans Will Politicize Trustees Report to Raise Beneficiary Costs. Republicans will likely seize on the 2013 Trustees Report to justify their plans to dramatically raise cost-sharing for beneficiaries. Half of all Medicare beneficiaries have incomes below $22,500, yet Republicans want to shift costs onto this population in order to pay for a fix to the Medicare physician system. Republicans will tout that similar policies were proposed in the President’s budget, but those budget proposals were in the context of a big deficit reduction package that included shared sacrifice with both spending cuts and revenue increases. Those proposals are not to be cherry-picked and do little to slow spending growth; they are merely cost-shifts. Republicans are not newcomers to the strategy of politicizing the Trustees Report in order to advance a plan to cut Medicare. In 1995, the then-Chairmen of the Republican National Committee, Haley Barbour, gleefully called the shortening of solvency under that year’s Trustees Report, “manna from heaven," and used it to justify then-Speaker Gingrich’s “Contract with America" to cut Medicare spending by 14 percent in order to provide tax breaks for the rich.
