FOR IMMEDIATE RELEASE, Thursday, January 31, 2008
CONTACT: Debbie Curtis (202) 225-5065

WASHINGTON, D.C. – Representative Pete Stark (D-CA), Chairman of the Ways and Means Health Subcommittee, today responded to press reports that the President will propose more than $100 billion in cuts to Medicare and Medicaid in his fiscal year 2009 budget submission, which will be publicly released Monday, February 4th.

“If press reports are accurate, President Bush’s budget would endanger the health care of America's seniors, people with disabilities, and low-income children. We’ve known for years that his “compassionate conservatism” was simply a slogan. These proposed cuts show his single-minded focus on starving popular and effective public programs, while protecting fat cat insurance companies that are overpaid with taxpayer dollars.

“Private plans are overpaid by 13 percent on average, but the President won’t cut one penny of their pork. Instead, his Medicare cuts focus on traditional fee-for-service providers. By far, the deepest cuts come from hospitals, especially those that train our nation’s doctors and take on the burden of serving patients with no means to pay. President Bush’s budget also assumes deep multi-year cuts to physicians.

“As for Medicaid, the reported cuts of $14 billion don’t even take into account his regulatory actions on Medicaid. Congress won’t help the Administration dismantle Medicaid, so they are restricting the ability of states to provide health care under Medicaid via the regulatory process.

“This budget will be dead-on-arrival.”

Press reports today state that the President’s Budget will include $91 billion in cuts to Medicare and $14 billion in cuts to Medicaid over the next five years (fiscal years 2009 to 2013). Medicare hospital cuts will total $83 billion, consisting of $15 billion in across-the-board cuts, $25 billion in cuts to disproportionate share hospitals that serve low income patients, $23 billion in cuts to indirect medical education, and $20 billion in cuts for hospital capital payments. The President’s proposed cuts to hospitals are more than double the amount in the Balanced Budget Act of 1997. Other provider cuts expected in his budget include a one-year payment freeze for skilled nursing facilities, a five-year payment freeze for home health agencies, and unknown cuts for hospice and ambulances.