The Corner

Health Care

Trump Proposes Medicare Cuts

My latest Bloomberg column notes the significant Medicare cuts in the president’s 2020 budget. These stand in stark contrast to his 2016 campaign rhetoric, in which he presented himself as guarding Medicare (and Social Security) against his Republican primary opponents, and even against Hillary Clinton. And they are especially significant in light of the 2020 Democratic presidential candidates who want to expand Medicare.

I’m with the president on this one. Three cheers for slowing the growth of Medicare.

Some of the cuts are very well designed because they would change the structure and underlying incentives of certain Medicare components. For example, physicians working in offices owned by, but not located in, hospitals would no longer be paid more for services than physicians working in offices not owned by hospitals. Other cuts are simply blunt reductions in payments to providers. The proposed budget is awarded 1.5 cheers for the way the overall cuts are designed.

To build off the president’s Medicare plan, we need more of the former types of cuts and less of the latter, which I discuss in the column.

Brace yourself for the 2020 Medicare wars.

Michael R. Strain — Michael R. Strain is the director of economic-policy studies and the Arthur F. Burns Scholar in Political Economy at the American Enterprise Institute.  

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