Earlier this week, President Obama released a proposal to reduce the federal deficit by $3 trillion over the next 10 years, in part by making cuts to Medicare and Medicaid. The plan was developed to provide guidance to the newly created debt panel, which is charged with finding $1.5 trillion in savings by the end of November.
Obama’s plan would cut $248 billion from Medicare, of which 90% would come from “reducing overpayments” within the program, according to administration officials. However, they said that some of the cuts would affect beneficiaries. Meanwhile, the proposal would cut $72 billion from Medicaid, but officials would not provide specifics on those reductions.
However, administration officials said that the health care cuts would be balanced with new tax revenues. The proposal calls for overhauling the tax code and raising $1.5 trillion primarily from taxing wealthy residents.