CHN: Senate Budget Committee Approves nearly $40 Billion in Cuts to Entitlement Programs

On Thursday, October 27, the Senate Budget committee approved a bill that cuts a net $39.1 billion from entitlement programs over the next five years. Next week the Senate will debate and vote on the measure that cuts Medicaid, Medicare, agriculture subsidies, student loans, pensions and other entitlement spending.
There are special debating procedures for a reconciliation bill – debate is limited to 20 hours and only 51 votes are needed for passage. Republican and Democratic leadership in the Senate have agreed to begin the debate at 4:00 p.m. on Monday, October 31. Debate will continue on Tuesday and Wednesday. At 6:00 p.m. on Wednesday time for debate will have expired. On Thursday and possibly Friday Senators will vote in quick succession on amendments (this is known informally as “vote-a-rama”).

The bill is a package of several separate pieces of legislation passed by various committees in the past two weeks.

In general, the Senate bill is less draconian than the House bill in terms of cuts that will affect low-income people. However, advocates are still concerned about what will happen when the Senate bill goes to conference with the House. Here are some key aspects of the Senate bill:

•  There are no cuts to foster care , SSI , child support enforcement or child care in the Senate bill.

•  The Senate does not include provisions to reauthorize TANF .

•  The Senate Agriculture Committee declined to cut Food Stamps and instead made larger cuts to commodities and conservation programs

•  Unlike its House counterpart, the Senate provisions on Medicaid do not require beneficiaries to pay more towards their care. The Senate bill also attempts to close loopholes for seniors who transfer assets in order to qualify for Medicaid nursing home care – but the provisions in the two bills differ, with the Senate’s provisions more narrowly targeted.

•  Many of the cuts to Medicaid come from closing loopholes on prescription drugs and revising how Medicaid pays for prescription drugs.

•  The Senate bill cuts about $16 billion from Medicare by eliminating the Medicare stabilization fund for private health care plans, linking Medicare payments to quality of care, and through other cuts not expected to affect beneficiaries.

•  The bill approved by the Senate Finance Committee actually cuts much more than $10 billion from Medicaid and Medicare. But it also includes provisions that increase costs, so the net cut equals close to $10 billion. One expensive provision will increase physician reimbursement rates for Medicare (not in the House bill). The Senate bill also redistributes State Children’s Health Insurance Program (SCHIP) surpluses to those states with SCHIP shortfalls, adding $138 million.

•  The Senate bill allows families with disabled children who have incomes slightly above poverty to retain Medicaid coverage, which costs $834 million. (Versions of the Family Opportunity Act have been approved by previous Senates.) Like the House, the Senate bill provides 100 percent federal Medicaid matching payments to states for persons living in areas affected by the hurricanes.

•  The Senate bill contains $13.7 billion in cuts to student loans, which student aid groups estimate will cost students an average of $3,800 in additional costs.

Better Budget for All
early childhood
Fact of the Week
Income Support
Our American Story
Policy Analyses and Research
SAVE State Fact Sheets: 2013
Social Services
Temporary Assistance for Needy Families