Is Entitlement Reform in the Near Future?
By Jamie McMillen, TSCL Legislative Director
As the month of February came to a close, President Barack Obama held a ‘fiscal responsibility summit’ to address certain long-term budget challenges. Entitlement programs such as Social Security and Medicare were among the topics discussed.
Addressing skyrocketing healthcare costs that also impact the amount of expenditures to the Medicare programwas a theme for many attendees. Peter Orszag, Director of the Office of Management and Budget, has said that fiscal responsibility must also be applied to health care. This comment comes on the heels of President Obama stating that he would reinstate pay-as-you-go (PAYGO) rules to help reduce the national deficit by one-half before the end of his four-year term. Under PAYGO rules, lawmakers would be required to offset any increased spending with increased revenue or spending cuts to other programs. If successful, the deficit would be reduced from approximately $1.3 trillion to $533 billion by 2013.
During a question and answer session following the summit, the President said, “There was a healthy debate on Social Security, but also a healthy consensus among some participants, including Congressmen Boehner and Hoyer as well as Senator Graham and Senator Durbin, that this was a moment to work in a bipartisan way to make progress on ensuring Americans' retirement security…”
President Obama continued, “Over the longer run, putting America on a sustainable fiscal course will require addressing health care. That seemed to be an issue that there was a lot of consensus around. Many of you said what I believe, that the biggest source of our deficits is the rising cost of health care.”
With the Social Security trust fund facing funding troubles by 2017, assuming better economic conditions than those we have today, and Medicare already in financial deficit, voices from both the conservative and liberal corners have proposed solutions to the growing problem. While some legislators claim an overhaul of the tax system and aggressive action to ward off problems associated with a growing older population and rising health care costs are necessary, others are calling for health care reform to stave off potential cuts to the programs.
In a press release, House Majority Leader Steny Hoyer (MD) called the summit a, “positive step as [Congress] begin(s) to address our nation’s long-term fiscal challenges…”. He went on to say, “The summit made it clear that tough choices will be necessary to rein in the record deficits and debt confronting our nation.”
The Senior Citizens League (TSCL) does not support any cuts to either Social Security or Medicare benefits. Instead, TSCL supports increased oversight to reduce fraudulent claims. A significant amount of expenditures comes from waste, fraud and abuse that hurts the solvency of Medicare for current and future retirees. When Medicare has had the investigative staff and tools required to combat fraud, about ten dollars for every dollar invested has been saved in the past.