The bipartisan infrastructure bill would lead to a $8.7 billion reduction in Medicare payments to providers, according to an estimate released Thursday by the nonpartisan Congressional Budget Office.
The bill proposes a 4% cut to Medicare payment rates for the first six months of 2031 in part to pay for more than $500 billion in new spending on roads, bridges, and other surface infrastructure.
The extension has been fiercely opposed by hospital groups, who argue Medicare shouldn't be cut to pay for unrelated infrastructure projects.
The cuts—known as the sequester—have been in effect since 2011 as a way to cut government spending. Under the infrastructure bill, it would expire in 2031.
The Medicare cuts have been suspended through the end of the year due to COVID-19, but will resume next year.
Sen. John Barrasso (R-Wyo.) filed an amendment to the infrastructure bill to strike the extension of the cuts, but it's not clear if it will receive a vote. The Senate is expected to vote on the bill in the coming days.
The infrastructure bill would also delay a Trump-era Medicare rule that would bar pharmacy benefit managers from keeping rebates paid by drugmakers under Part D. Delaying that rule would save about $50 billion, the CBO said.
Another provision of the infrastructure bill would require drugmakers to pay rebates to Medicare for wasted units of drugs that are packaged in too-large vials, generating the government about $3 billion.
The bill would still raise the deficit by $256 billion.