Bush Budget Proposal Targets Spending on Health Care Programs
President Bush on Monday will release a fiscal year 2009 budget request that will total more than $3 trillion and include a large reduction in Medicare spending, the Wall Street Journal reports (McKinnon, Wall Street Journal, 2/1). The budget request would decrease Medicare spending by $178 billion over five years as part of a $200 billion reduction in entitlement program spending (Freking, AP/Houston Chronicle, 1/31).
Under the budget request, most of the reduction in Medicare spending would result from decreases in reimbursements to physicians, hospitals and other health care providers, as well as efforts to reduce payments for services to a level closer to the actual cost, according to an unnamed White House official (Weisman, Washington Post, 2/1). The budget request also would increase monthly premiums for Medicare beneficiaries enrolled in the prescription drug benefit (Koffler/Cohn, CongressDaily, 2/1).
The budget request would reduce Medicare spending growth to 5% from 7.2% currently and would reduce by one-third the estimated unfunded obligation for the program over 75 years, according to the Journal (Wall Street Journal, 2/1). The budget request also would reduce Medicaid spending by $17 billion over five years (Pelofsky, Reuters, 1/31).
The budget request would place a "virtual freeze" on domestic discretionary spending, the Post reports (Washington Post, 2/1). An unnamed White House official said that the budget request would increase domestic discretionary spending by less than 1% (AP/Houston Chronicle, 1/31).
Under the budget request, HHS discretionary spending would decrease by $2.2 billion to $68.5 billion. The budget request also would reduce CDC spending by $433 million and increase FDA spending by $130 million (Wayne, CQ Today, 1/31). The budget request includes $29.3 billion in funds for NIH, which would "basically flat-fund medical research at current-year spending, not enough to keep pace with inflation," according to CongressDaily (CongressDaily, 2/1).
Congress last year rejected a request from Bush for a $65 billion reduction in Medicare spending (Washington Post, 2/1). In addition, the proposed reduction in Medicare spending "will face heavy opposition from powerful health care provider groups that could be affected by the Medicare cuts," CongressDaily reports (CongressDaily, 2/1).
House Ways and Means Health Subcommittee Chair Pete Stark (D-Calif.) said that the proposed reductions in Medicare and Medicaid spending would "endanger the health care of America's seniors, people with disabilities and low-income children" (Wall Street Journal, 2/1). He added, "This budget will be dead on arrival" (CQ HealthBeat, 1/31).