The Republicans’ super committee proposal to reduce the deficit would make much deeper cuts to Medicare and Medicaid and achieve less deficit reduction that the plan offered by Democrats last week, the Center for Budget and Policy Priorities (CBPP) concludes in a new report. For instance, “four-fifths of the Republicans’ proposed Medicare cuts— $400 billion — would directly affect beneficiaries through higher premiums, higher cost sharing, and more restrictive eligibility criteria,” while Democrats include $200 billion in reductions to beneficiaries.
As a result, the GOP’s plan — when coupled with the reductions to Medicaid — would substantially impact lower-income beneficiaries:
Since half of Medicare beneficiaries had incomes below $21,100 in 2010, it would be virtually impossible to achieve this level of beneficiary cuts without imposing substantial increases in out-of-pocket costs on near-poor elderly and disabled people — those between 100 and 200 percent of the poverty line (about $11,000 to $22,000 for an individual). Yet the typical Medicare beneficiary in this income range already pays 23 percent of income for out-of-pocket costs, a percentage that would increase significantly under both plans — especially under the Republican plan. […]
The Republican plan also would make far deeper cuts in Medicaid — $185 billion versus $75 billion over ten years under the Democratic plan. Cuts of this depth would shift substantial costs to state governments, which would lead to state actions that limit care for the low-income children, parents, seniors, and people with disabilities whom Medicaid serves.