Bush plans to up Medicare cuts to $619B over the next 10 years

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Bush’s budget calls for CMS cuts. Source: Bloomberg News  

President George W. Bush is expected to propose reductions to the Centers for Medicare & Medicaid Services' budget by $16 billion in 2009, $196 billion over the next five years and $619 billion over 10 years in his 2009 budget proposal.

Bush’s $3.1 trillion fiscal 2009 budget, which is scheduled to take effect on Oct. 1, projects a surplus in fiscal 2012, as the short-term effects of the economic stimulus package are erased by spending cuts and higher tax receipts as the economy recovers.

The President is proposing $619.4 billion in net mandatory program savings — assuming some increases, including $50 billion more for the State Children's Health Insurance Program over the next 10 years. The largest reduction comes from Medicare, where Bush proposes to cut $556.4 billion from its rate of growth over the next decade, and Medicaid would endure a $46.7 billion loss, according to CongressDaily.

If the proposal goes into effect, the Centers for Disease Control and Prevention (CDC), who will see their budget reduced to $8.8 billion, which is $412.1 million less than the agency received last year.

Julie Gerberding, MD, CDC director, told Reuters that these cuts mean focusing on the most urgent needs at the expense of other programs, including combating emerging infectious diseases and promoting public wellness.

"Social Security and Medicare are going to be taking a bigger and bigger piece," Gerberding told Reuters on Monday. "The rest of us are going to be fighting over a smaller and smaller amount of money."

In response to the proposed cuts, the National Committee to Preserve Social Security and Medicare's President and CEO Barbara B. Kennelly said that while “healthcare costs soar, millions of Americans remain uninsured and baby boomers approach retirement, the last thing this nation needs is more of the same from the Bush administration. Proposing $178 billion in Medicare cuts which will directly impact healthcare access for millions of seniors, while, at the same time, preserve $150 billion in insurance industry giveaways, is outrageous and indefensible.”

"Some are going to be unhappy with this budget," Health and Human Services Secretary Michael O. Leavitt said in a press conference on Monday. Leavitt stressed that the cuts were needed to protect Medicare's finances, which he defined as a system that needs to be changed.

The Washington Post reported that Medicare comprises 56 percent of the $737 billion HHS budget, Leavitt said. Cuts in the Medicare budget will become the norm until Medicare itself changes, he said. 

President Bush and Leavitt are expected to meet opposition in Congress. "This administration ought to know that five years' worth of Medicare and Medicaid cuts totaling $200 billion are dead on arrival with me and with most of the Congress," Sen. Max Baucus, D-Mont., and chairman of the Senate Finance Committee, told the  Associated Press.