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Medicare Compliance & Reimbursement

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Presidential Budget To Cut $100 Billion From Medicare, Medicaid

Published on Thu Jan 25, 2007

Democratic presidential hopefuls lambast 2008 budget.

President Bush released his budget for the fiscal year 2008 on Feb. 5, and his proposed budget of nearly $700 billion for the Department of Health and Human Services (HHS) has drawn the ire of Democrats everywhere.

The President's budget for HHS represents a $28-billion increase from 2007 and includes $67.6 billion earmarked for discretionary program spending--a $95-million increase in discretionary funds. Despite these increases, Democrats complain that the President's budget shortchanges Americans.

"With respect to Medicaid and Medicare, the President's plan will make our health care safety net even worse by cutting over $100 billion between direct budget cuts and regulations that will lead to budget cuts out of Medicare and Medicaid," said presidential candidate Sen. Hillary Clinton (D-NY).

In an apparent response to President Bush's proposed Medicare and Medicaid cuts, Democratic presidential candidate John Edwards released a proposal for universal health care on Feb. 5, a plan that advocates expanding Medicaid.

"We have to give the silent victims, who stand in line at free clinics and use the expired medicines of friends and neighbors, we have to give them the dignity of universal health care," Edwards told the Democratic National Committee.

HHS Secretary Mike Leavitt defended the budget, arguing that Medicare and Medicaid cuts will target legislative and administrative spending. "We are serving our citizens with compassion while maintaining sensible stewardship of their tax dollars," Leavitt said.

Funding for Medicare benefits would actually be $454 billion in 2008, an increase of $28 billion from 2007. As benefit spending swells, the proposed budget would save $76 billion in legislative and administrative costs over five years and slow Medicare's growth rate from 6.5 percent to 5.6 percent in the same period, according to an HHS statement.

Bush rebuffed suggestions that his budget weakened national health care programs, insisting that his funding schedule would make Medicare and Medicaid viable in the long term.

"Social Security, Medicare and Medicaid are commitments of conscience, and so it is our duty to keep them permanently sound," the President said in a statement. "In the short term, my budget works to slow the rate of growth of these programs, saving $96 billion over five years. This administration is also actively working with Congress to comprehensively reform and improve these vital programs so they will be strong for the next generation of Americans."

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