BBB and Medicare

[Anonymous]

https://www.kiplinger.com/retirement/medicare/tax-reconciliation-bill-could-trigger-billions-in-medicare-cuts

Has link to OMB confirmation letter.

Basically, when they passed the Pay as You Go law years ago, OMB has to issue orders to cut spending based on effect of programs on the deficit. Medicare is NOT excluded (SS and Medicaid are). Congress has to enact legislation to waive this effect when that happens, but that legislation requires 60 votes in the Senate, not a simple majority. Without that, Medicare gets cut $490 billion. This will happen in FY 2026.

[Anonymous]

I'm not sure if this has anything to do with Pay as you go, but in the 90s, they passed cuts to Medicare(reduce growth rate in spending), mostly payments to hospitals I think.

Congress every year would override these cuts, but they are still part of the baseline.
They actually used these cuts as part of ObamaCare budgeted savings, even though everyone knew they would be overrridden.

[Anonymous]

People were warned.

[Anonymous]

Anonymous wrote:I'm not sure if this has anything to do with Pay as you go, but in the 90s, they passed cuts to Medicare(reduce growth rate in spending), mostly payments to hospitals I think.

Congress every year would override these cuts, but they are still part of the baseline.
They actually used these cuts as part of ObamaCare budgeted savings, even though everyone knew they would be overrridden.

OMB letter (link is in the article)
"How Would Sequestration Affect Medicare and Other Programs,
Assuming That Funding Subject to Sequestration Remained Equal to the
Amounts in CBO’s January 2025 Baseline Projections?
Under S-PAYGO, reductions in Medicare spending are limited to 4 percent—
or an estimated $45 billion for fiscal year 2026. That would leave $185 billion
to be sequestered from the federal budget’s remaining direct spending
accounts in that year.
S-PAYGO exempts many large accounts, including those that provide funding
for Social Security and low-income programs. Therefore, in CBO’s
estimation, OMB would have roughly $120 billion in budgetary resources
available for cancellation in 2026—less than the remaining amount that would
be required to be sequestered"

How Would Medicare Be Affected After 2026?
The 4 percent maximum reduction in Medicare spending would apply to
sequestration orders for years after 2026. If OMB ordered a sequestration of
$230 billion for each year through 2034, the ordered reductions in Medicare
spending would increase to about $75 billion in 2034 and would total roughly
$490 billion over the 2027–2034 period.
How Would All Other Programs That Are Subject to Sequestration
Be Affected?
After accounting for the reduction in Medicare spending, the required
reduction in spending for other programs would exceed the estimated amount
of resources available to those programs in each year over the 2027–2034
period. If OMB sequestered all of the funding for those programs, the total
amounts would be less than the reductions required by S-PAYGO.
I hope this information is useful to you. Please contact me if you have further
questions.

I think the bottom line is that, in fact, the worst is yet to come.

[Anonymous]

https://bsky.app/profile/atrupar.com/post/3lthhwchvtw2h

USDA Secretary Brooke Rollins on farm laborers: "There will be no amnesty. The mass deportations continue, but in a strategic way. And we move the workforce toward automation and 100% American participation, which with 34 million able-bodied on Medicaid we should be able to do fairly quickly."

I didn't know farm laborers received health insurance. Is this something that the BBB mandates?

[Anonymous]

Anonymous wrote:https://www.kiplinger.com/retirement/medicare/tax-reconciliation-bill-could-trigger-billions-in-medicare-cuts

Has link to OMB confirmation letter.

Basically, when they passed the Pay as You Go law years ago, OMB has to issue orders to cut spending based on effect of programs on the deficit. Medicare is NOT excluded (SS and Medicaid are). Congress has to enact legislation to waive this effect when that happens, but that legislation requires 60 votes in the Senate, not a simple majority. Without that, Medicare gets cut $490 billion. This will happen in FY 2026.

There will be no problem getting 60 votes for Medicare in an election year.

[Anonymous]

They should take it out of the Medicare HMO payment rates. Those rates are well over costs plus normal profit, compared to the fee for service program. United lobbyists do their job well. :/

[Anonymous]

Anonymous wrote:

Anonymous wrote:https://www.kiplinger.com/retirement/medicare/tax-reconciliation-bill-could-trigger-billions-in-medicare-cuts

Has link to OMB confirmation letter.

Basically, when they passed the Pay as You Go law years ago, OMB has to issue orders to cut spending based on effect of programs on the deficit. Medicare is NOT excluded (SS and Medicaid are). Congress has to enact legislation to waive this effect when that happens, but that legislation requires 60 votes in the Senate, not a simple majority. Without that, Medicare gets cut $490 billion. This will happen in FY 2026.

There will be no problem getting 60 votes for Medicare in an election year.

I agree. However, that's what I mean about the Titanic.The BBB will add to the deficit. Meanwhile, the SS and Medicare cost challenges remain to be addressed.

[Anonymous]

Anonymous wrote:They should take it out of the Medicare HMO payment rates. Those rates are well over costs plus normal profit, compared to the fee for service program. United lobbyists do their job well. :/

Worse than that. I had no idea about this, but something like 70% of people receiving some form of Medicaid are on managed care plans. I imagine this includes people on Medicaid expansion, it also includes people on Medicare Advantage who also qualify for Medicaid, and it includes states where their Medicaid is run by a private company under a managed care system.