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Capitol Hill Budget Deal Avoids Premium Hikes and Budget Cuts in Medicaid and Social Security Disability Insurance

December 31, 2015

The White House has proposed an FY2016 budget deal that would prevent the double-digit premium increases feared by many Medicaid and Social Security Disability Insurance (SSDI) beneficiaries. Specifically, the deal will stave off a 52 percent premium increase for Medicare Part B enrollees and would prevent a 20 percent broad cut of all Social Security disability benefits.

The budget deal is in anticipation of the impact of an expected early 2016 Medicare budget shortfall for Social Security. The Social Security fund may be depleted, meaning that the government may only be able to pay off 80 percent of what is actually owed to Social Security beneficiaries. House and Senate leaders in both parties, concerned about the effect of this shortfall on Americans, have put forward many different measures that would reform Social Security without compromising disability benefits programs like Medicaid and SSDI.

Unfortunately, a two percent cut in all Medicare payments is a key provision in the bill, along with several other cost-saving revisions to the budget law, all of which would impact people with disabilities. The White House and the GOP struck a compromise deal on a provision that requires large employers to automatically enroll new employees in their health plans and rollover current employees, which is projected to save $8 billion through 2025. Other reforms to Social Security would impose stronger oversight, reporting requirements and stricter penalties for fraud and abuse of the system. These stricter oversight requirements and changes to the way in which employees are enrolled may change how some workers with disabilities, currently enrolled in Medicare, receive benefits.

For further information, read The Hill article, the Congressional Budget Office report on the automatic employee enrollment provision and the Board of Trustees report on the expected 2016 Social Security budget shortfall.

http://thehill.com/policy/healthcare/258165-gop-eying-social-security-reforms-in-budget-deal

https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/costestimate/reconciliationrecommendationseducationandtheworkforce.pdf

https://ssa.gov/oact/TR/2015/tr2015.pdf