NAHC Action Alert – Dissuade Congress from Using Medicare Dollars to Fund New Trade Bill
April 27, 2015 07:28 AM
On Thursday evening, the House Ways & Means Committee approved legislation that would divert Medicare dollars in order to pay for the reauthorization of the Trade Adjustment Assistance (TAA) program. As previously reported, the Senate Finance Committee approved the same measure on Wednesday. The trade legislation includes a 0.25 percent cut to Medicare providers for the last six months of 2024 to offset the cost of the legislation.
Earlier in the week, NAHC and three other organizations—the American Hospital Association, American Medical Association, American Health Care Association—sent a letter [link] to members of the US Senate and House opposing the provision in the TAA bill that would include cuts to Medicare as a pay-for to offset the cost of the legislation. Senior groups, including the National Committee to Preserve Social Security & Medicare, also criticized the Medicare cuts.
NAHC worked behind the scenes with committee members to advance efforts to replace the Medicare cuts. Several members of Congress in both the House and the Senate raised concerns about the cuts to Medicare. Due to those efforts, House Ways & Means Committee Chairman Paul Ryan (R-WI-1) expressed his willingness moving forward to consider more acceptable alternatives to pay for the trade legislation before it becomes law.
“I understand people have concerns about one of the pay-fors, which is the Medicare sequester. I share those concerns,” Chairman Ryan said. “I’m willing to explore options for replacing it between now and when this gets into law, or when it gets to the floor perhaps. So I’m willing to work with the Minority on that.”
During the House Ways & Means Committee session, several Democrats raised concerns about the Medicare cuts and eventually voted against the overall trade legislation specifically in opposition to the Medicare provision. The Committee approved the trade measure, with 13 Democrats voting in opposition.
“I think the sequester to start with is a bad policy,” said Committee Ranking Member Sandy Levin (D-MI-9). “I think it’s a bad precedent to extend it beyond its current expiration. I think it’s also very concerning to use Medicare money to pay for trade. And I think, finally, we just passed SGR and now what we’re going to do is to essentially ask for some additional monies from providers.”
Congressman Joseph Crowley (D-NY-14) introduced an amendment that would have replaced the Medicare cuts with a pay-for that would improve tax compliance. Committee Republicans raised a procedural motion against the amendment, arguing that the proposed pay-for was out of the Committee’s jurisdiction.
“We can’t keep talking about taking from these critical health providers and expect it not to have the negative effects on our seniors and access to care,” said Congressman Crowley. “If doctors stop practicing, or hospitals or nursing homes are forced to close, or home care agencies have a longer wait list, that hurts our seniors.”
Congressman Crowley also reiterated a concerned expressed by NAHC regarding the precedent of using Medicare funding for non-Medicare legislation. “We can’t expect our health care providers to be used as a piggy bank for every bill that comes before us,” he said. “If we’re going to tell our doctors and other health care providers that they should constantly be worried about facing cuts to pay not just health care bills but trade bills, or anything else that needs funding, that undermines those very same goals.”
Congressman Ron Kind (D-WI-3) also offered an amendment to remove the Medicare cuts. Congressman Kind withdrew his amendment with the “assurance” from Chairman Ryan that they would “continue working on an appropriate offset.” Congressman Kind also stated his opinion that it would be difficult for Congress to achieve enough votes to pass the trade legislation with the Medicare cuts included. “Calling for further Medicare sequester cuts in order to pay for a trade measure just doesn’t fly,” he said. “I think it’s unfair and the policy is wrong.”
Other Democrats expressed similar concerns about Congress diverting funds designated to serve Medicare patients for other purposes. “It’s not fair and it’s not right to rob the most vulnerable segment of our society,” said Congressman John Lewis (D-GA-5).
During the Senate Finance Committee mark-up of the trade legislation on Wednesday, Senator Mark Warner (D-VA) also introduced and then withdrew an amendment that would have replaced the Medicare cuts with a provision that would fund the trade legislation by altering mortgage reporting requirements. Senate Finance Committee Ranking Member Ron Wyden (D-OR) committed to working with Senator Warner moving forward.
“One thing that I think most of us agree on both sides of the aisle is sequestration is stupidity on steroids,” said Senator Warner. “I think that Medicare sequestration disproportionately hurts our rural hospitals and health centers is unfortunate.”
Currently, the sequester cuts to Medicare are set to expire at the end of the first six months of 2024. Members of Congress established a 4 percent cut to Medicare providers for the first six months of 2024, in order to average 2 percent for the entire year. The trade legislation, however, would impose a 0.25 percent cut to Medicare providers for the last six months of 2024, thereby increasing the overall sequester cut to Medicare providers in 2024 above the current 2 percent level included in the Budget Control Act. According to estimates by the Congressional Budget Office, the legislation would increase the sequester cut to Medicare by $700 million.
In the letter to members of Congress, NAHC and the other associations stated that Medicare providers have already made significant sacrifices and raised concerns about the use of Medicare cuts to fund non-Medicare legislation.
Please use NAHC’s Legislative Action Center to dissuade your members of Congress from using Medicare cuts to fund the trade legislation.