Congress Reacts to Obama’s Budget Proposal

President Obama has made his budget proposal and lawmakers on Capitol Hill have already started trying to shape it to their will.

One of the most controversial pages in the budget book: the proposal to change the way that benefits are adjusted for inflation under Social Security and other federal programs, will be taken up on April 18 by the House Ways and Means Committee. The chained consumer price index, or chained CPI, would result in less-generous cost-of-living adjustments in the future.

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Republicans like the idea because it will help reduce the federal budget deficit, but Obama is struggling to win over his own party on the matter.

Reps. Alan Grayson (D-Fla.) and Mark Takano (D_Calif.) have swayed 37 lawmakers to sign a pledge against the chained CPI along with other benefit cuts.

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“Voters across the political spectrum oppose cuts to Medicare, Medicaid, and Social Security benefits, and we must do whatever it takes to protect these vital benefits from cuts,” the pledge says. “That’s why we write to let you know that we will vote against any and every cut to Medicare, Medicaid, or Social Security benefits — including raising the retirement age or cutting the cost of living adjustments that our constituents earned and need.”

Republicans have successfully used such tactics to rally members against tax cuts. However, the success of that idea was grounded in conservative Grover Norquist’s influence in reminding politicians of the pledge when difficult votes arose.

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One of Obama’s ore supported budget ideas is paying drug makers less for brand-name medications prescribed to low-income seniors. Participation in Medicaid requires drug makers to give the federal government a rebate that serves as a volume discount, however Medicare does not get the same discounted rate. The Medicaid discount doesn’t apply to patients who are eligible for both programs.

Bills in both the House and Senate would require drug makers to pay rebates of close to $140 billion over the next 10 years for these “dual eligibles.” Sen. Jay Rockefeller (D-W. Va.) says his legislation is aimed at “putting low-income seniors and people with disabilities before pharmaceutical profit.”

Read more: http://blog.aarp.org/2013/04/18/congress-nibbles-at-obamas-budget/?sf11851886=1

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