Late News: Healthcare may take hit

When the president delivers his spending blueprint this week, he is likely to dust off ideas for healthcare cuts he has proposed before. Liberal advocates, though, are girding for a new wrinkle for seniors.

The White House plans to release President Barack Obama's budget April 10, and many groups are focused on an expected provision that would embrace the so-called chained Consumer Price Index to slow future Social Security spending.

David Certner, legislative policy director for AARP, said in an interview that policy—which would save Social Security about

$127 billion over 10 years—was a leading focus for the seniors' group. Such a substantial reduction in seniors' retirement benefits could affect their ability to afford healthcare, he said.

The approach would link Social Security's cost-of-living increases to a Consumer Price Index that grows more slowly than the one the program currently employs. Word that Obama would embrace the idea also drew criticism from other traditional Obama allies.

“The Senate just last month went on record in opposition to the president's approach,” Sen. Bernie Sanders (I-Vt.) said in a statement issued Friday. “In poll after poll, the American people are overwhelmingly against cutting Social Security.”

Other likely proposals aimed at fiscal discipline drew a more positive response. For instance, the president is expected to again propose requiring rebates from drug manufacturers on drugs that Medicaid beneficiaries get through Medicare Part D. Certner hailed the rebates as a way to reduce the program's costs without harming beneficiaries.

The budget is expected to include many of the provider cuts that were included in Obama's previous budgets. Out of the

$5 billion in total Medicare savings proposed in his last spending plan, $3.8 billion came from drug policy changes, $770 million came from cuts in bad debt payments to hospitals and $180 million came from a change in rules for rehabilitation facilities.

Ilisa Halpern Paul, managing government relations director at Drinker, Biddle & Reath in Washington, predicted Obama would play both defense and offense on healthcare.

“On defense, he likely will make clear that he intends to go full steam ahead on ACA implementation and funding will be included for those efforts. On offense, he is expected to include cuts—an estimated $400 billion—to Medicare to show he is serious about deficit reduction,” Halpern Paul said in an e-mail.

“However, in the offense-defense approach, Medicaid will be spared cuts. Given the integral role that the Medicaid expansion plays in the ACA with respect to increasing the numbers of insured, that move is not surprising,” she added. “We also have heard that he plans to fund a pre-K expansion through an increase in tobacco excise taxes, which is something that the public health community likely will support.”