Budget focuses on keeping Medicare solvent without lowering benefits or raising patient costs
March 24, 2023 (ACP) — The American College of Physicians is pleased by the budget that President Biden is proposing for the federal fiscal year that begins in October 2023.
Among other positive aspects, the proposed budget includes provisions to keep Medicare solvent and protect beneficiaries from skyrocketing expenses.
“ACP is encouraged to see that the proposed 2024 federal budget … recognizes the critical role that the Medicare program plays in keeping Americans healthy,” Dr. Ryan D. Mire, president of ACP, said in a statement. “We agree with the president that keeping the Medicare program solvent is of utmost importance, and that it is important that we do so while ensuring that services for beneficiaries are not eliminated. ACP is also pleased that the proposed budget includes provisions that would lower out-of-pocket costs for beneficiaries. Lowering the cost for prescription drugs and for behavioral health services will help my patients access the care they need. A healthy Medicare program is key to our country's health care future.”
The proposed budget represents President Biden's priorities in numerous areas that directly affect the nation's patients and physicians:
- The president proposes to extend the solvency of the Medicare Hospital Insurance Trust Fund by at least 25 years without lowering benefits or raising costs for patients. In part, this would be accomplished by raising the Medicare tax rate on incomes over $400,000.
Currently, the trust fund is expected to run out of money in 2028.
“The president's approach is somewhat different from other ideas that are being discussed on Capitol Hill right now” said Shari Erickson, ACP chief advocacy officer and senior vice president. “We're hopeful that lawmakers will come around to embrace the ideas that are laid out in the budget about how to avoid increasing costs or lowering benefits.”
- The president's budget also includes a proposal to make subsidies for health insurance policies bought through HealthCare.gov and state-based Marketplace plans permanent. Last year's Inflation Reduction Act temporarily extended the subsidies for insurance premiums, which average $800 a year.
ACP has long advocated for the extension of these premium subsidies, Erickson said.
As the White House explained in a statement, the budget “also provides Medicaid-like coverage to individuals in states that have not adopted Medicaid expansion under the ACA [Affordable Care Act], paired with financial incentives to ensure states maintain their existing expansions.”
- A total of $150 billion over 10 years is proposed for improving and expanding Medicaid home- and community-based services. “To bolster the health care workforce,” the White House said, “the budget provides a total of $966 million in 2024 to expand the National Health Service Corps, which provides loan repayment and scholarships to health care professionals in exchange for practicing in underserved areas, and a total of $350 million to expand programs that train and support the nursing workforce.
- The proposed budget aims to extend Medicare's new powers to negotiate drug costs: The president wants more medications to be included. The Biden administration also wants to begin negotiations more quickly after drugs enter the market.
“The budget also proposes to limit Medicare Part D cost-sharing for high-value generic drugs used for certain chronic conditions like hypertension and high cholesterol to no more than $2,” the White House said. “For Medicaid, the budget includes proposals to ensure Medicaid and CHIP [Children's Health Insurance Program] programs are prudent purchasers of prescription drugs, authorizing HHS [Department of Health & Human Services] to negotiate supplemental drug rebates on behalf of interested states in order to pool purchasing power. For the commercial market, the budget includes proposals to curb inflation in prescription drug prices and cap the prices of insulin products at $35 for a monthly prescription.”
On other fronts, Erickson said ACP is pleased that the proposed budget includes funding to continue school lunch programs. “We released a paper just this past year on the importance of addressing food nutrition security,” she said.
The budget also addresses other areas of keen interest to ACP: Funding is proposed to invest in clean energy and cut greenhouse gas emissions, address gun violence and reduce maternal mortality and morbidity rates. Medicaid coverage, for example, would be extended to cover mothers for a year postpartum.
Erickson said ACP is disappointed that the proposed budget does not address the threatened cutbacks in payment rates for clinicians that plague the medical community every year. Nor does it address the need for inflationary adjustments to the Medicare Physician Fee Schedule. Still, “we support the budget, and we're hoping that constructive conversations will be happening on Capitol Hill,” she said. “There are lots of opportunities for bipartisan action.”
Going forward, she said, “we'll be providing guidance to Congress throughout the year and offering the opportunity for our members to engage in grassroots outreach with their members of Congress over the coming months.” Discussions on the budget often extend into the late fall, as lawmakers work to finalize a spending plan for the fiscal year that begins in October.