Griffin to Sebelius: Work with Us to Save Medicare, Increase Our Ability to Fund Critical Investments Like Medical Research

Mar 12, 2014 Issues: Budget, Health, Spending Cuts and Debt

WASHINGTON – At today’s Ways and Means Committee hearing on President Obama’s 2015 budget proposal, Congressman Tim Griffin (AR-02) questioned U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius about whether the Obama Administration will ever address the problem of mandatory entitlement spending eating up discretionary spending on critical investments.

During a July 11, 2011 press conference at the White House, President Obama said:

The vast majority of Democrats on Capitol Hill would prefer not to have to do anything on entitlements; would prefer, frankly, not to have to do anything on some of these debt and deficit problems….

And what I’ve tried to explain to them is, number one, if you look at the numbers, then Medicare in particular will run out of money and we will not be able to sustain that program no matter how much taxes go up.  I mean, it’s not an option for us to just sit by and do nothing.  And if you’re a progressive who cares about the integrity of Social Security and Medicare and Medicaid, and believes that it is part of what makes our country great that we look after our seniors and we look after the most vulnerable, then we have an obligation to make sure that we make those changes that are required to make it sustainable over the long term.

And if you’re a progressive that cares about investments in Head Start and student loan programs and medical research and infrastructure, we’re not going to be able to make progress on those areas if we haven’t gotten our fiscal house in order.

In his 2013 State of the Union address, President Obama said: “Yes, the biggest driver of our long-term debt is the rising cost of health care for an aging population. And those of us who care deeply about programs like Medicare must embrace the need for modest reforms -- otherwise, our retirement programs will crowd out the investments we need for our children, and jeopardize the promise of a secure retirement for future generations.”

Over President Obama’s five years in office, the national debt has increased $6.9 trillion, from $10.6 trillion to $17.5 trillion.

Under President Obama’s 2015 budget proposal, the federal budget would never balance—ever. In fact, it would add $8.3 trillion to the national debt over the next 10 years, and gross debt would climb to $25 trillion in 2024.

HEARING TRANSCRIPT:

GRIFFIN: What I’d like to talk with you a little bit about is the issue of investments…. Almost every constituent that comes to see me in my office talks about the need for additional funding, for example, for the NIH [National Institutes of Health], for Alzheimer’s research, for cancer research, MS [Multiple Sclerosis], diabetes, they may talk about education, they may talk about some other program that is funded by discretionary spending. And a lot of times, when people mention investments, that’s what they’re talking about. And I have supported increasing NIH research funding; I wish we had the money to increase it drastically. But the reality is that that funding is getting squeezed out by the growth of entitlement spending. If you could look, I have a slide here. This is something that President Obama said in 2011:

GRIFFIN: [Now let’s move on to the] Next slide. This is what I call “the Pac-Man problem” [video]. I use this to explain to folks who come to visit me why the funding that they are in favor of—which, often, I favor; NIH funding for example—why it’s under pressure. It’s under pressure because the yellow part, which we recognize as Pac-Man, is continuing to close its mouth on all the stuff that you refer to as “investments.”

GRIFFIN: And HHS Secretary after HHS Secretary—in both administrations, Republican and Democrat—praised their budget as fixing the problem. But the problem persists. And I just invite you to work with us for real reform on Medicare to fix this, and I would welcome your comments on how your budget will address this problem.

SEBELIUS: Well, sir, I would welcome the opportunity to work on a serious, big budget deal, including entitlement reform but also including tax reform and revenue sharing and spread that equally across the board. I would say that the passage of the Affordable Care Act [Obamacare] was one the most significant issues of late to increase the solvency of the Medicare trust fund. The Trustees put that passage at about a 12-year additional solvency. This budget adds an additional five years, so when this President came into office, Medicare was likely to go broke in 2017. That window has now been significantly extended and this committee has voted 50 times to repeal those very—

GRIFFIN: But you’re robbing Peter to pay Paul and the seniors are bearing that burden.

END OF HEARING TRANSCRIPT

According to the House Budget Committee: “Advocates of the President’s health care law claimed that the law both improved Medicare’s solvency and paid for the new entitlement at the same time. This claim is contradictory. Medicare’s chief actuary testified before the House Budget Committee that the Medicare savings had been double-counted.”

In July 2012, the nonpartisan Congressional Budget Office (CBO) estimated that Obamacare’s cuts to Medicare will total more than $700 billion.

In a 2009 interview with ABC News reporter Jake Tapper, President Obama said:

TAPPER: One of the concerns about health care and how you pay for it — one third of the funding comes from cuts to Medicare.

BARACK OBAMA: Right.

TAPPER: A lot of times, as you know, what happens in Congress is somebody will do something bold and then Congress, close to election season, will undo it.

OBAMA: Right.

TAPPER: You saw that with the “doc fix.”

OBAMA: Right.

TAPPER: Are you willing to pledge that whatever cuts in Medicare are being made to fund health insurance, one third of it, that you will veto anything that tries to undo that?

OBAMA: Yes.

As Jeffrey H. Anderson, who was the senior speechwriter for former HHS Secretary Mike Leavitt, recently explained in The Weekly Standard:

One of President Obama’s greatest political challenges has been hiding the fact that Obamacare is largely financed by siphoning huge sums of money out of Medicare. In particular, Obamacare cuts—or guts—Medicare Advantage, the popular program that allows seniors to get their Medicare benefits through private insurers. In fact, it’s only these Medicare Advantage cuts that allow the Congressional Budget Office to pretend that Obamacare won’t raise deficits—an implausible notion that polling indicates only a very small percentage of particularly credulous citizens believe.

Late on Friday, February 21, in a 148-page, after-hours communication, the Obama administration declared that cuts to Medicare Advantage, long put off, will finally take effect in 2015. Predictably, and understandably, many conservatives responded by criticizing the announcement.

The cuts are bad in and of themselves, but cuts to the program have been a part of Obamacare’s written text from day one. So the real question is not whether Obamacare will cut Medicare Advantage; it’s whether the Obama administration—which doesn’t want those cuts to become evident when Medicare’s open-enrollment period begins on October 15, less than three weeks before Election Day—will take unilateral, lawless executive action to stop the cuts from taking place. That’s what has happened to date.

In the lead-up to Obama’s reelection, he and his administration weren’t satisfied with having mailed out full-color, taxpayer-funded propaganda brochures and run millions of dollars’ worth of taxpayer-funded TV ads featuring Andy Griffith, all touting Obamacare to seniors. They knew that such nonsense would quickly be exposed if Obamacare’s prescribed Medicare Advantage cuts were to take effect: Seniors would have started noticing those cuts on October 15, 2012….

Now, two years later…Medicare Advantage is back on the chopping block. The CBO says that if Obama’s centerpiece legislation is implemented as written, about $200 billion will be funneled out of Medicare Advantage and into Obamacare over the next decade. Like low-premium health plans and their accompanying health savings accounts, both of which Obamacare aims to diminish or eliminate, Medicare Advantage has proven extremely popular: Its enrollment more than doubled, according to the New York Times, in just the past eight years. With over 15 million seniors now in the program—more than a quarter of all Medicare beneficiaries—Obama-care’s $200 billion raid amounts to about $13,000 per current Medicare Advantage enrollee.

But Medicare Advantage is hardly the only part of Medicare that is scheduled to be looted by Obamacare. The CBO projects that, over the next decade, about $1 trillion that would otherwise have been spent on Medicare will be rerouted to Obamacare. That represents more than 10 percent of Medicare’s entire projected funding—which helps explain why Medicare’s Office of the Actuary has projected that, by 2020, Medicare will reimburse doctors and other health care providers at lower rates than Medicaid will. Imagine if Obama had pitched Obamacare by saying, Folks, we’re going to pass health reform, and to pay for it, we’re going to divert more than 10 percent of the money that’s projected to be spent on Medicare. That pitch would have made Jimmy Carter’s “malaise” speech look like a triumph of political rhetoric. But, as the CBO notes, that’s exactly what Obamacare will do.

To be sure, Medicare badly needs to be reformed, and less should be spent on it. But at a time when we are $17 trillion in debt and our Army is shrinking to pre-World War II levels, money shouldn’t be reallocated from Medicare to finance a highly unpopular, $2 trillion overhaul of American medicine….

In September 2013, the non-partisan actuaries at the Centers for Medicare and Medicaid Services (CMS) concluded that Obamacare would increase national health spending $621 billion over the next 10 years.