The plan would also reduce funding for the rest of the Medicaid program by about $500 billion over ten years. To date, the ACA coverage expansions have extended coverage to an estimated 16.4 million previously uninsured people and strengthened coverage for millions of others. The plan repeals the Affordable Care Act (ACA), including health reform’s subsidies, which make marketplace coverage affordable for people with low or modest incomes, and its Medicaid expansion. As Figure 3 shows, the budget would cut health care support for such households by 46 percent - or by nearly half - by 2025. The $4.9 trillion reduction over the next decade includes more than $2.7 trillion in health care cuts, the vast majority of which would affect low- and moderate-income households. The budget plan pushes it far below that, and well below the previous post-World War II low of 9.4 percent of GDP. Currently, such spending is 11.3 percent of GDP, already below its historical average. Overall, the budget cuts federal spending outside Social Security, Medicare, and interest payments on the debt to 7.2 percent of gross domestic product (GDP) in 2025 - roughly 40 percent below the 12.2 percent average over the past four decades. (See Figure 3.) The deepest reductions occur in health programs. With the cuts the budget imposes, spending on these programs would shrink below these levels by at least 39 percent, on average, by 2025. Total federal spending on programs for people with low and modest incomes is already scheduled to decline as a share of the economy over the decade under current policies. The budget plan disproportionately targets these programs for 63 percent of the cuts even though they constitute only about one-fourth of program spending. The second involves negotiations around the funding levels for appropriated programs.Ĭuts in programs that assist families with low and moderate incomes - whether to entitlement (“mandatory”) spending programs or to annually appropriated (“discretionary”) programs - account for about $3.1 trillion of the $4.9 trillion in non-defense cuts, and probably more. One is an expedited legislative process known as “reconciliation” that the Republican majority is expected to use to attempt to repeal or modify the Affordable Care Act. The final section describes the pivotal budget decision points later this year, which are expected to occur on two tracks. The report then addresses the key budget process changes in the plan. It then discusses the revenue proposals - or the lack thereof - in the budget. Next it explains the gimmick the plan uses to provide additional funding for defense in 2016. This report begins with an examination of the $4.9 trillion in non-defense spending cuts in the budget plan. Rather, a budget resolution is a blueprint, and its proposed policy changes can be implemented only if Congress adopts and the President signs subsequent legislation embodying those changes. A congressional budget resolution by itself does not change any funding levels or any statutory language affecting expenditures and revenues. Enshrining budget balance as the preeminent policy goal is neither necessary nor appropriate.įortunately, most of the budget’s policy proposals will not readily become law. The 2016 budget resolution represents an alarming vision for the nation’s fiscal future.The plan’s distorted priorities reflect its focus on balancing the budget over the decade without any new revenue (even from scaling back tax breaks for the wealthy) and while slightly increasing defense funding. If implemented, the plan would cause tens of millions of people to lose their health insurance or become underinsured, reduce basic food assistance for large numbers of low-income families and individuals, shrink support for millions of working families struggling to make ends meet, and make it harder for low- and modest-income students to afford college. It concentrates nearly two-thirds of these cuts on programs that serve people of limited means. It proposes to slash non-defense programs by nearly $5 trillion over the next decade, shrinking much of government to levels not seen in the modern era. The 2016 budget resolution, which Congress adopted on May 5 with only Republican votes, represents an alarming vision for the nation’s fiscal future.
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