Obama No Longer Open to Raising Medicare Age To Avoid Sequestration
President Obama will not support raising Medicare's eligibility age as part of a larger deal to avoid automatic spending cuts under sequestration, a White House spokesperson said on Monday, AP/Modern Healthcare reports (AP/Modern Healthcare, 2/11).
The mandated spending cuts under sequestration involve about $1 trillion in across-the-board reductions. In January, President Obama signedÂ legislation -- negotiated by Vice President Biden and Senate Minority Leader Mitch McConnell (R-Ky.) -- that delayed the cuts by two months, to March 1 (California Healthline, 2/11).
Obama No Longer Supports Strategy
During previous sequester negotiations, Obama had been open to the idea of raising the eligibility age from 65 to 67 as part of a "grand bargain" that would include spending cuts and higher taxes to reduce the federal deficit (Baker, "Healthwatch," The Hill, 2/11).
However, on Monday, White House Press Secretary Jay Carney confirmed that raising Medicare's eligibility age is off the table for Obama, saying, "The president's made clear that we don't believe that that's the right policy to take" (Rampton, Reuters, 2/11).
Although Democrats strongly opposed raising the eligibility age, the administration previously viewed the plan as political leverage in deficit-reduction negotiations to get Republicans to agree to more tax revenue.
According the Washington Post's "Wonkblog," Obama believed the Affordable Care Act would help protect U.S. residents who had to wait an additional two years before reaching eligibility age.
However, since the idea was first floated during talks in 2011, health care experts have concluded that raising the Medicare eligibility age would be counterproductive, because although it would reduce the federal deficit, it would increase national health spending because individuals ages 65 to 67 would be shifted to more costly coverage options. In addition, the Obama administration no longer believes Republicans will agree to a deal with enough tax revenue to justify raising the eligibility age (Klein, "Wonkblog," Washington Post, 2/11).
Democratic House Minority Leader Nancy Pelosi -- a longtime opponent to raising Medicare's eligibility age -- on Sunday questioned whether the move would produce savings because elderly U.S. residents not on Medicare would still need health care. During an interview on Fox News, Pelosi said there are other ways to save money in Medicare, adding, "I don't think it has to come out of benefits, or beneficiaries, and I don't think you have to raise the age."
Meanwhile, Rep. Jack Kingston (R-Ga.) -- chair of the House Appropriations Subcommittee, which oversees appropriations for HHS -- said he does not expect to see any Medicare changes this year. "We do not have the leadership at this point in our country to have an intelligent, a mature discussion on Medicare," he said (Ethridge, CQ Roll Call, 2/11).
Senate Democrats To Propose Alternative Plan To Avoid Sequester
In related news, Senate Democrats plan to unveil legislation that would delay automatic spending cuts under sequestration for 10 months through approximately $120 billion in targeted spending cuts and tax increases on higher income U.S. residents, Reuters reports (Cowan et al., Reuters, 2/11).
The bill would replace the $85 billion in spending cuts under the sequester by raising $55 billion in tax revenue over 10 years, while the rest of the package would consist of spending cuts (Kasperowicz, "Floor Action Blog," The Hill, 2/11). The legislation is likely to be introduced in the Senate on Thursday, but it is not expected to gain Republican support (Cowan et al., Reuters, 2/11).
According to CQ Roll Call, both House Speaker John Boehner (R-Ohio) and Senate Minority Leader Mitch McConnell (R-Ky.) have said they would not support plans that raise taxes (Ota/Krawzak, CQ Roll Call, 2/11).
On Monday, McConnell called the senators' plan a "colossal waste of time." He said, "My constituents in Kentucky will not accept a tax hike in the place of spending cuts that were already agreed to by both parties" in fiscal cliff talks ("Floor Action Blog," The Hill, 2/11).
White House Admits U.S. Has Spending Problem
Meanwhile, Carney on Monday also said the federal government has a spending problem that "is specifically driven" by health care spending, Politico reports. Carney said that he believes "every economist" would agree that "the principle driver, when it comes to spending, of our deficits and debt, are, is health care spending."
He noted that Obama recognizes the problem and "took action" through the ACA, adding, the law "has been scored by the CBO to significantly reduce our health care costs going forward." Carney was responding to comments from Pelosi, who on Sunday said that "[i]t is almost a false argument to say we have a spending problem" in the U.S. (Slack, Politico, 2/11).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.