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Morning Briefing

Summaries of health policy coverage from major news organizations

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Tuesday, May 23 2017

Full Issue

Trump's Proposed Budget Slices Safety Net For Poor, Disabled

President Donald Trump wants to slash Medicaid by more than $800 billion and slim down the Children's Health Insurance Program, as well.

President Donald Trump is sending Congress a $4.1 trillion spending plan that relies on faster economic growth and steep cuts in a range of support programs for low-income individuals to balance the government鈥檚 books over the next decade. (Taylor and Crutsinger, 5/23)

President Trump on Tuesday will propose cutting federal spending by $3.6聽trillion over 10聽years, a historic budget contraction that would severely ratchet back spending across dozens of programs and could completely reshape government assistance to the poor. The White House鈥檚 $4.094聽trillion budget request for fiscal 2018 calls for cuts that hit Medicaid, food assistance and other anti-poverty programs. It would cut funding for the Children鈥檚 Health Insurance Program (CHIP), which provides benefits to the poor, by roughly 20聽percent next year. (Paletta and Costa, 5/22)

Among the reductions, the president鈥檚 budget proposes $250 billion in saving over a decade through the repeal and replacement of the Affordable Care Act, President Barack Obama鈥檚 signature legislative policy. Those savings would come largely through reductions to Medicaid, the federal-state health insurance program for low-income people. Other unspecified reforms to Medicaid and the federal Children鈥檚 Health Insurance Program would shave another $616 billion from government spending through 2027. (Nicholas, Davidson and Timiraos, 5/22)

Over the next decade, it calls for slashing more than $800 billion from Medicaid, the federal health program for the poor, while slicing $192 billion from nutritional assistance and $272 billion over all from welfare programs. And domestic programs outside of military and homeland security whose budgets are determined annually by Congress would also take a hit, their funding falling by $57 billion, or 10.6 percent. The plan would cut by more than $72 billion the disability benefits upon which millions of Americans rely. It would eliminate loan programs that subsidize college education for the poor and those who take jobs in government or nonprofit organizations. (Davis, 5/22)

The proposal would transition the joint federal-state program from a traditional entitlement to either a block grant or per capita cap. It would also allow states to impose work requirements for certain Medicaid beneficiaries. 鈥淭his proposal will free States to advance solutions that best serve their unique populations 鈥 for example, encouraging work, promoting personal responsibility, and meeting the spectrum of diverse needs of their Medicaid populations,鈥 the budget document said.聽(Weixel, Roubein and Hellmann, 5/22)

Making low-income Americans work to qualify for so-called welfare programs is a key theme of the budget. 鈥淚f you are on food stamps and you are able bodied, we need you to go to work,鈥 said budget director Mick Mulvaney during a White House briefing on Monday. He said the strengthened requirements in the budget focuses on putting the聽6.8 million unemployed or underemployed Americans back to work. 鈥淭here is a dignity to work,鈥 he said, 鈥渁nd there鈥檚 a necessity to work to help the country succeed.鈥 (Dewey and Jan, 5/22)

Taken together, the cuts represent a significant reordering of the social safety net, away from poor families and toward older Americans, regardless of income. Medicare would be untouched, and the main function of Social Security 鈥 retirement income 鈥 would flow unimpeded. (Alcindor, 5/22)

The budget to be released Tuesday will show that the annual federal deficit, which was $585 billion in the fiscal year that ended Sept. 30, will steadily decline until fiscal year 2027, when the nation will have a $16-billion surplus 鈥 the first since the start of the George W. Bush administration, though small in the context of what by then would be a nearly $6-trillion budget. (Bennett, 5/22)

[E]ven if Congress goes along with the budget the president will send to Capitol Hill on Tuesday 鈥斅爓hich is unlikely 鈥斅爄t requires rosy economic assumptions to work. (Groppe, 5/22)

Trump鈥檚 budget, like any other proposed by a president in recent years, is more of a statement of his priorities and policy beliefs than a document expected to approved as-is by Congress. The legislative branch is certain to come up with far different proposals through the appropriations process of horse-trading and House-Senate compromise. (Spangler, 5/22)

The budget proposes to extend funding for CHIP for two additional years through fiscal 2019. It calls for eliminating an extra 23 percentage point increase in the federal matching rate that the health care law had provided to states. It also would cap the matching rate so that states that want to expand the program would no longer get federal funds for kids in families with income that is more than 250 percent of the federal poverty level. 鈥淭hese provisions would return the focus of CHIP to the most vulnerable and low-income children,鈥 says the budget. Some state officials in both parties are likely to oppose the reductions in CHIP funding. (Young, 5/22)

鈥淭his budget sort of sits on top of what is done in the AHCA, which is to cut Medicaid by a large amount, cut the Affordable Care Act subsidies by another $300 billion and provide a big tax break for corporations and wealthy people,鈥 said Judith Solomon, vice president for health policy at the liberal Center on Budget and Policy Priorities. 鈥淚t鈥檚 taking from the poor to confer benefits on the rich. . . . So it鈥檚 Robin Hood in reverse,鈥 Solomon said. (Pugh, 5/22)

The budget proposal underscores the wide gulf between campaigning and governing, even for a president who promised to rewrite the presidential rule book. (Restuccia, Nussbaum and Ferris, 5/22)

Meanwhile, Stat offers an explainer on where that Medicaid money is going聽鈥

That proposal聽assumes that the American Health Care Act 鈥 passed by the House earlier this month 鈥 will become law. That鈥檚 far from a sure thing, given big questions about聽the Senate鈥檚 plans for health care reform. But if Medicaid is going to be slashed, it鈥檚 worth taking a look at exactly how the program spends its money now. After all, Medicaid accounts for $1 out of every $6 spent on health care in the US. But there are major differences in what that spending looks like on a state-by-state level. And certain services cost Medicaid far more than others. (Thielking, 5/22)

This is part of the Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
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