Wednesday, April 3, 2024

New Report Makes Trump’s Point about Lowering Entitlement Spending

There they go again. Following a series of comments by Donald Trump during a recent CNBC interview, Joe Biden has brought out the “Mediscare” attack in recent weeks, trying to demagogue his way to reelection.

But a new Government Accountability Office (GAO) report illustrates the improper and potentially fraudulent spending within programs like Medicare and Medicaid. It should be enough to ask politicians like Biden, and even Trump, who can’t wait to attack their opponents for wanting to “cut” Medicare: So … you support maintaining health care fraud?

Improper Payments Update

Trump’s initial comments will not win awards for clarity, but the general tenor seems clear: “First of all, there is a lot you can do in terms of entitlements — in terms of cutting — and also in terms of the theft and the bad management of entitlements.”

Two weeks later, when the GAO report on improper payments for the fiscal year that ended last Sept. 30 comes out, guess which program tops the list? You guessed it. Medicare.

In fiscal year 2023, the Medicare program reported a total of $51.1 billion in improper payments. A total of $31 billion in improper payments came from the traditional fee-for-service program, while $17 billion came from Medicare Advantage, in which private insurance companies contract with the federal government to provide Medicare benefits to seniors.

The fact that government-run Medicare had nearly twice as many dollars worth of improper payments compared to the privately delivered benefit, in a year when Medicare Advantage overtook traditional Medicare in enrolling a majority (51 percent) of eligible beneficiaries, shows a distinct contrast. Improper payments do not necessarily connote fraud. They could be a signal of payments in the wrong amount or without the proper documentation. That said, the disparity between traditional Medicare and Medicare Advantage suggests the government-run plan does not place a premium on processing claims correctly.

Waste in Other Health Programs

Lest one thinks improper payments remain confined to Medicare, think again. According to the GAO survey, the Medicaid program closely trailed Medicare, with “only” $50 billion in improper payments during the last fiscal year. In many ways, this $50 billion represents an underestimate, because the prohibition on states disenrolling Medicaid participants during the Covid pandemic meant that last year’s improper payment survey did not fully assess whether states are allowing ineligible individuals to remain on the rolls.

Other health care programs received prominence in the GAO report, with Obamacare’s premium subsidies reporting a 26.0 percent improper payment rate, and the State Children’s Health Insurance Program having a 12.6 percent rate of improper payments. In fact, most of the programs spotlighted in the report were either pandemic-era programs rife with fraud (e.g., unemployment benefits, the Paycheck Protection Program, etc.) or health care programs.

Rebut the Mediscare’ Attacks

As unpopular as it is to say, reducing, or even eliminating, improper payments won’t solve all the structural problems that programs like Medicare face. But pointing out the waste and ineffective bureaucracy in these programs, and forcing leftist politicians to defend their rhetoric, will show the silliness behind their attacks.

When someone, including Donald Trump, says they won’t “cut” Medicare, ask them: Does that include fraud too? Does making billionaires like Bill Gates or Warren Buffett pay more for their benefits constitute a “cut” to seniors?

For conservatives, making the left defend their absurd positions, such as no reductions in Medicare spending ever, under any circumstance, should help to spark the more realistic conversation that our entire country needs to have about the benefits that our politicians have promised to generations of seniors, even though we cannot afford them in their current form.

Remember: For years, Joe Biden supported reductions in Medicare and Social Security benefits. He voted against a debt limit increase because it did not freeze Medicare and Social Security spending. While in the Senate, he even introduced a bill to sunset every federal program — including Medicare and Social Security — every four years. He also took it upon himself to rent a mansion while dodging over $500,000 in Medicare and Obamacare taxes.

Conservatives, and the American people in general, should take no lessons from Joe Biden when it comes to preserving Medicare and Social Security. Instead, politicians from both parties should stop the ridiculous rhetoric and start doing what it takes — beginning with cracking down on fraud — to make the programs solvent and sustainable in the long term.

This post was originally published at The Federalist.