U.S. Markets closed

Top Trump Advisers Differ Over Whether Medicare Reform Is ‘On the Table’

Eric Pianin

Barely a week after Treasury Secretary Steven Mnuchin declared that President Trump would make good on his campaign pledge not to go after Medicare and other entitlement programs, Health and Human Services Secretary Tom Price said in effect “not so fast.”

Price, the former conservative House Budget Committee chair and orthopedic surgeon who was brought aboard by Trump to oversee the dismantling of the Affordable Care Act, declined to rule out cuts or other changes in Medicare for seniors during an appearance Sunday on CBS’s Face the Nation.

Related: Mnuchin Promises No Budget Cuts to Social Security and Medicare

Asked by host John Dickerson whether House Speaker Paul Ryan (R-WI) was correct in saying recently that Medicare reform was “still on the table” as part of budget negotiations this year, Price essentially dodged the question and declined to contradict Ryan. Instead, he launched into a warning about Medicare’s shaky long-term finances.

“The challenge that we have, as you well know and your viewers know, is that Medicare is, as some folks have said, going insolvent or going broke,” Price said. “Within a ten-year period, we won’t have the money in the Medicare program to be able to pay the benefits to seniors in this country that has been promised to them. We don’t think that’s appropriate.”

“So we believe in -- strongly in the guarantee of Medicare and make certain that it’s a viable, financially secure program going forward so that seniors now, and in the future, know that it will be there for them,” Price added.

Price’s homily on fiscal discipline was a far cry from Mnuchen’s comments a week ago and suggests a rift within the administration over whether to begin tinkering with the federal health insurance program for seniors that covers more than 55 million people.

Related: 3 Basic Problems Holding Up the GOP Obamacare Replacement Plan

 Mnuchin, a wealthy former Wall Street banker and hedge fund manager, insisted that Trump would adhere to his campaign promises to leave Social Security and Medicare alone, even as the administration seeks deep cuts in other areas to cover the cost of a $54 billion military build up, construction of a wall along the southern border with Mexico, other infrastructure construction and a major tax cut.

Asked by Maria Bartiromo of Fox Business Network whether the Trump administration “needs to hit entitlements sooner rather than later” with the national debt fast approaching $20 trillion, Mnuchin replied, “We are not touching those now. So don’t expect to see that as part of this budget. We are very focused on other aspects, and that’s what’s very important to us. That’s the president’s priority.”

However, Mick Mulvaney, a former conservative Republican House member from South Carolina and the new White House budget director, insisted during his Senate confirmations hearings that he would push for Social Security and Medicare reforms.

Mulvaney once called Social Security a “Ponzi scheme” that requires overhauling. And Mulvaney and Price have promoted House proposals for converting Medicare into a voucher-type program for  tens of millions of future recipients.

Related: A Military Buildup and Big Tax Cuts: Is the Debt Set to Soar Under Trump?

Social Security, Medicare, and Medicaid for low-income people accounted for nearly $1.8 trillion of the government’s $3.9 trillion in spending in 2016, according to the non-partisan Congressional Budget Office. What’s more, with the number of people 65 and over projected to increase by a third over the coming decade, Social Security and Medicare spending are projected to increase to 42 percent of total government outlays by 2027.

Medicare alone will exhaust its reserves and begin curtailing payments in 2028 absent any changes in the programs, according to a report issued last year by the Social Security and Medicare trustees.

The Committee for a Responsible Federal Budget, the Concord Coalition, and other anti-deficit groups have urged Trump to focus on the need for changes to slow the rate of growth of spending on retirement benefits and heath care. However, Trump has repeatedly signaled that efforts to balance the budget must be put on the back burner while he rebuilds the military and energizes the economy with trillions of dollars of new tax cuts.

Related: Prospects Dim for Deficit Control as Trump Drives for Defense Buildup

Leon Panetta, a former defense secretary and White House budget director during the Obama and Clinton administrations, said over the weekend that Trump and the Republican controlled Congress must come to an agreement on a budget “that really deals with this $20 trillion debt that we face.”

 “What you have got to do is put everything on the table,” Panetta, a deficit hawk, said in a separate “Face the Nation appearance. “You have got to put entitlements, you have to put taxes, and you have to put discretionary. That’s what we did in the past. That’s how we got a balanced budget.”

Top Reads from The Fiscal Times: