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Jon Greenberg
By Jon Greenberg March 6, 2019

Bernie Sanders attacks Donald Trump over proposed cuts to Medicaid, Medicare, disability fund

Presidential candidate Bernie Sanders used Washington’s three biggest safety net programs to draw a sharp line between himself and President Donald Trump.

At a CNN town hall, Sanders rebuked Trump for his promise not to cut Social Security, Medicare and Medicaid.

"And then he came forth with a budget — a trillion dollar cut in Medicaid, $500 billion to Medicare, and $72 billion for the Social Security Disability Fund," Sanders said Feb. 25.

We looked at his numbers for all three budget proposals and found solid support for the first, slightly less for the second, and the least for the third.

All of these reductions come with a standard caveat: They refer to future spending compared to the amount that would be spent under current law. So a budget can call for more dollars year after year, but if that’s less than what population growth and inflation and other factors would predict, both the White House and lawmakers refer to that as either savings or cuts (depending on which side of the debate they are on).

Trillion dollar cut to Medicaid?

The Sanders team told us the overall statement has to do with Trump’s FY 2019 budget plan. A White House budget is never more than a picture of a world the administration would like to see, because the final spending policy decisions are made by Congress. That’s especially true for this budget’s Medicaid provisions.

Offered in February 2018, the proposal relied on replacing Obamacare subsidies and Medicaid with a block grant to the states, mirroring a plan that a few months earlier had stalled in the Senate.

The White House plan included caps on the growth of Medicaid and the creation of a new grant program. Sorting out the net impacts on spending is tricky. Year to year, spending rises. The Congressional Budget Office estimated that Medicaid spending would fall by $1.3 trillion over the 10 years between 2019 and 2028, based on current law.

On the other hand, the CBO said the new state grant program would get nearly $970 billion over the same period. A portion of that would go toward people helped by Medicaid today.

"The net effect of those changes is $954 billion in cuts," said senior policy director Marc Goldwein of the Committee for a Responsible Federal Budget, a group with hawkish views on deficits. "There are also modest cuts elsewhere in the program that could bring the number closer to $1 trillion."

‘$500 billion’ from Medicare

At first blush, America’s health insurance program for seniors and the disabled would get $472 billion less under Trump’s budget, according to the CBO. But some of those dollars come back through different doors.

The biggest example involves paying hospitals and other providers for care they provide but never get paid for. The White House budget reduces payments by at least $100 billion, but that’s partly offset by a newly created uncompensated care pool worth $63 billion.

There’s a similar dynamic with the budget line for graduate medical education. Those dollars flow to "teaching hospitals," essentially places where new doctors continue their training. The White House trims the original budget line by $146 billion, but then proposes $139 billion for a fund that would cover this for both Medicare and Medicaid, which has a similar physician training provision. There’s still a cut between the two of $28 billion. The numbers don’t show exactly how much would fall on Medicare, but the net result is much smaller than first appears.

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Overall, "the true cut is less than the $472 billion," said John Holahan, a fellow in the Health Policy Institute at the Urban Institute in Washington.

Goldwein estimated the total cut at closer to $300 billion. And again, we note that actual dollars spent rise each year.

It is worth noting that President Barack Obama also proposed Medicare cuts totalling $419 billion over 10 years. Trimming payments to providers was central to the Obama administration’s long-term strategy to keep Medicare financially balanced. The two single largest reductions proposed by Trump curtailed the dollars going to hospitals, which isn't the same as taking benefits away from Medicare recipients.

White House inflates disability effects

The White House budget message itself provides the $72 billion reduction in disability payments that Sanders cited. But two-thirds of that might never come to pass.

The White House counts $48 billion in savings from testing "new approaches to increase labor force participation." That refers to programs to keep people working, because if they work, those people won’t need disability payments. If those pilot efforts cut benefits regardless of whether people find work, then the cuts would be real.

But Goldwein at the Committee for a Responsible Federal Budget is skeptical.

"These savings mostly won’t materialize," he said.

The CBO doesn’t include the $48 billion savings in its analysis. Its tally shows about $15 billion in cuts for the disabled.

The White House total also includes savings in the Social Security Supplemental Security Income fund, which is a separate program.

Our ruling

Sanders said Trump proposed cuts of $1 trillion to Medicaid, $500 billion to Medicare and $72 billion to the Social Security Disability Fund.

Numbers from the CBO and experts we reached confirmed the $1 trillion in Medicaid reductions.

The Medicare reductions are less than Sanders said, probably in the range of $300 to $400 billion.

While the White House might claim $72 billion in savings from the Social Security Disability Fund, the CBO put the number at about $15 billion.

There’s no question Trump’s budget called for major reductions in Medicaid and Medicare spending from what would have been without changes in law or policy. Part of that plan reduced money going to hospitals and other providers, which is not the same as reducing benefits to recipients.

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Says President Donald Trump "came forth with a budget — a trillion dollar cut in Medicaid, $500 billion to Medicare, and $72 billion for the Social Security Disability Fund."
In a CNN town hall event in Washington, D.C.
Monday, February 25, 2019

Our Sources

CNN, Town hall with Bernie Sanders, Feb. 25, 2019

White House, FY 2019 Budget, February 2018

Congressional Budget Office, An Analysis of the President’s 2019 Budget, May 24, 2018

Congressional Budget Office, Proposals Affecting Health Programs, May 31, 2018

Congressional Budget Office, Proposals affecting Medicare, June 5, 2018

Congressional Budget Office, Proposals affecting Social Security Disability Fund, May 31, 2018

Georgetown University Health Policy Center, Administration’s Budget Proposal Includes $1.4 Trillion in Medicaid Cuts, Feb. 12, 2018

Committee for a Responsible Federal Budget, Analysis of the President's FY 2019 Budget, Feb. 12, 2018

Committee for a Responsible Federal Budget, Does the President's Budget Slash Social Security and Medicare?, Feb. 16, 2018

National Committee to Preserve Social Security and Medicare, The President’s FY 2019 Budget – It Literally Leaves Seniors in the Cold, Feb. 14, 2018

Association of American Medical Colleges, President’s Budget Includes Major Cuts to Graduate Medical Education, Feb. 12, 2016

National Association of Counties, President Trump's FY 2019 budget: Highlights from the county perspective, February 2018

Washington Post, White House budget proposal includes huge deficits, cuts in safety net, Feb. 12, 2018

Urban Institute, How Would the President’s 2019 Budget Proposal Shift Our Fiscal Path?, October 2018

Interview, Josh Orton, adviser, Sanders for President, March 5, 2019

Email interview, Nicole Maestas, associate professor of health care policy, Harvard Medical School, March 5, 2019

Email interview, Marc Goldwein, senior policy director, Committee for a Responsible Federal Budget, March 5, 2019

Email interview, John Holahan, institute fellow, Health Policy Institute, Urban Institute, March 6, 2019

 

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