Biden’s claim that Trump is ‘pushing to slash Medicare benefits’

October 13, 2020

The explanation from the Biden campaign was also surprising, So let’s explore this claim in detail. It’s an interesting and complex story.

The Facts

The Biden campaign explained that this line hinged on the fact that President Trump is backing a lawsuit that would nullify the Affordable Care Act, also known as Obamacare. The Trump administration filed a legal brief on June 25 asking the Supreme Court to strike down the entire law, joining with a group of GOP state attorneys general who argue that the ACA is unconstitutional. The court will hear arguments in the case, known as California v. Texas, on Nov. 10.

The case hinges on the fact that Trump’s 2017 tax law in effect eliminated the ACA’s individual mandate penalty by reducing it to zero. Without the mandate, the whole law should fall, rather than just individual portions, the plaintiffs argue. Trump decided to embrace that argument, rather than say that if one part of the law was unconstitutional, the other parts of the law could survive.

In an effort to reduce the number of people in the United States without health insurance, the ACA set up an insurance-market exchange and provided subsidies to help people buy individual insurance. The law also greatly expanded Medicaid, the health-care program for the poor. To help pay for this, the law also made adjustments to Medicare, mostly big cuts in payments to Medicare providers and a hike in the payroll tax for wealthy taxpayers.

Separately, the law added a handful of additional benefits for people on Medicare, primarily a gradual closing of the coverage gap — “the doughnut hole” — in the Medicare Part D program when coverage ceased for prescription drugs once a limit was reached.

The law also provided some free or reduced cost-sharing for some preventive services, such as mammograms and colonoscopies, as well as a free annual wellness visit. Private insurance plans known as Medicare Advantage also could no longer charge higher cost-sharing amounts than traditional fee-for-service Medicare for certain services, including skilled-nursing facility care, chemotherapy and kidney dialysis.

A Supreme Court amicus brief by AARP, the interest group for the elderly, cited an estimate that 40.1 million people took advantage of at least one Medicare preventive service with no co-pays or deductibles in 2016, while more than 10.3 million Medicare beneficiaries took advantage of an annual wellness visit.

The Biden campaign argues that it’s fair to say that Medicare benefits would be slashed because if the whole law fell, these benefits would disappear, as would every other part of the law.

Well, not so fast.

First of all, the Bipartisan Budget Act of 2018, signed by Trump, sped up closure of the doughnut hole and, as of 2020, there is no longer a coverage gap. Four experts, both inside and outside Congress, told us that even if the ACA was repealed, the doughnut-hole closure is done and cannot be reversed.

(A discordant note was offered by Juliette Cubanski, deputy director of the Program on Medicare Policy at the Kaiser Family Foundation. She said there was not “100 percent certainty” what would happen to the doughnut hole: “I’m not aware of any legal opinion that asserts it would definitely survive the legal challenge as a result of the further legislative changes made to the coverage gap provision by the BBA.”)

Second, Trump has never taken a policy position against these enhanced Medicare benefits. In fact, as we noted, he actually sped up the closure of the doughnut hole with bipartisan support. We searched through the various bills that Republicans advanced in the House and Senate in 2017. All of them left these Medicare benefits untouched.

“We never have touched the doughnut hole except to improve upon the ACA on a bipartisan basis,” noted one GOP House aide involved in health-care policy.

It’s a different story for coverage of preexisting health conditions. Those House and Senate bills might have weakened protections for preexisting conditions, so it would be fair to argue that Trump would advocate for the same policies if the ACA was overturned and a new law was needed to replace the ACA.

But it’s much harder to make the same policy argument about the Medicare benefits in the ACA. It’s especially hard when, assuming the closure of the doughnut hole is safe, we are only talking about certain screening benefits. For the 40 percent of Medicare beneficiaries in Medicare Advantage, it may be even less of an issue.

“I suppose it’s possible to imagine that eliminating the ACA could, by eliminating that rule, ultimately lead to some more plans requiring cost sharing for preventive services,” Yuval Levin, a health-care expert at the American Enterprise Institute, said in an email. “But I think it’s pretty unlikely just as a matter of their market logic (i.e. once you’ve offered that benefit, taking it away in a competitive Medicare Advantage market wouldn’t make sense to you), and in any case would not make a significant difference to most seniors.”

“The ACA lawsuit is ridiculous (and also that it has no chance whatsoever in the Supreme Court), and I think the administration’s decision to back the suit was a mistake on several levels,” Levin added. “And yet, I don’t think the charge that ‘Trump is pushing to slash Medicare benefit’ is reasonable at all.”

But other experts said that the administration’s position that the entire law must be wiped out must be taken seriously. According to numerous reports, including in The Washington Post, Attorney General William P. Barr urged Trump to take a less aggressive stance and instead say that some parts of the Affordable Care Act could be preserved. Trump rejected that advice, and so the administration’s brief argues: “The entire ACA thus must fall with the individual mandate.”

“The Trump Administration’s legal filings in California v. Texas — rather than these or any other unpassed GOP health-care bills — represent the most current and clear articulation of the president’s position on the future of the ACA, including the law’s Medicare provisions,” said Lindsey Copeland, federal policy director at the Medicare Rights Center, a nonprofit consumer service organization. “And in those documents, the administration is actively supporting the elimination of the ACA in its entirety. The ACA’s Medicare changes are lengthy and complex. Striking the law would detrimentally impact Medicare coverage and costs, both of which are commonly referred to as ‘benefits.’”

Still, Jonathan Adler, a law professor at Case Western Reserve University who vehemently opposed the ACA but thinks the current lawsuit is quite weak, noted that the administration’s brief is unclear on the Medicare provisions. “Their brief does argue that the whole ACA is inseverable, but it also says that the court should limit its relief to those provisions that actually cause injury to the plaintiffs,” he said. “It’s not clear to me how the Medicare benefit provisions would injure either the state or individual plaintiffs, so it’s not clear to me the Trump administration is asking the court to cut Medicare benefits.”

“The Trump administration’s brief in their lawsuit to overturn the ACA says ‘the entire ACA must fall,’ and Donald Trump has repeated that clear objective numerous times over the course of the last few years,” Biden campaign spokesman Michael Gwin said in a statement. “A full repeal of the Affordable Care Act wouldn’t just take away health care for tens of millions of Americans or gut protections for over 100 million Americans with pre-existing conditions — it would also slash benefits for Medicare recipients by re-opening the prescription drug donut hole, and it would cut access to critical preventative care. For senior citizens whose safety has been threatened by Trump’s mishandling of this pandemic, and who face a financial squeeze because of his failed economic policies, the lawsuit Trump is eagerly pushing would only create even more pain.”

The Pinocchio Test

The Biden campaign appears to be making a mountain out of a molehill. Some Medicare benefits in theory might go away if the ACA was ruled unconstitutional by the Supreme Court. But the most important change — closure of the coverage gap known as the doughnut hole — appears relatively secure because of subsequent law signed by Trump.

Moreover, Trump or his Republican supporters have never taken a public position against these benefits, in contrast to changes sought on coverage for preexisting conditions. Trump promised to “repeal and replace” Obamacare — but that did not include the handful of Medicare benefit enhancements.

It’s certainly fair game to target Trump for seeking to nullify the entire ACA. But the Biden campaign goes too far to declare he is seeking to “slash” Medicare benefits without providing any context for the accusation. We wavered between Two and Three Pinocchios. In the end, we decided that because Trump rejected an option to tell the Supreme Court that at least some parts of the law could be preserved, he left himself open to an attack. The Biden campaign earns Two Pinocchios.