Iowa’s Chuck Grassley pushes back on Biden Medicare plan

Iowa U.S. Sen. Chuck Grassley says the White House’s proposal to extend Medicare’s solvency is likely to run into stiff Republican opposition.

During his weekly conference call with Iowa reporters, Grassley on Wednesday pushed back on President Joe Biden’s budget proposal, saying higher taxes on wealthy Americans to extend Medicare funding "isn't going to solve this problem for the next 75 years."

“President Biden wants to raise taxes, wants more government spending,” Grassley told The Gazette. “He also wants to take credit for purely phony deficit reduction. … His budget shows us that his administration has no intention of moderating, and no intention of sincerely grappling with, the country’s worsening fiscal health.”

Biden this week called for higher taxes on wealthy Americans to extend Medicare funding as part of his 2024 budget.

Biden’s proposal would raise the Medicare tax rate from 3.8 percent to 5 percent on high-income earners making more than $400,000 per year.

The plan also aims to expand Medicare’s ability to negotiate prescription drug prices beyond the measures enacted through the Inflation Reduction Act.

Biden’s proposal seeks to cut deficits by nearly $3 trillion over the next decade by raising taxes on wealthy Americans and corporations.

Biden has suggested that tax increases on the earnings and holdings of the country’s wealthiest households can bolster government finances and improve the long-term solvency of Medicare and Social Security.

“It’s too piecemeal,” Grassley said. “We’ve got sit down and solve this problem once and for all. … You have Republicans and Democrats around the table, and you’ve got to sit down in full faith and negotiation — and that is everything is on the table.”

The proposal comes amid a debate over the future of the social safety net programs as Congress faces a looming deadline to raise the federal debt limit or risk default.

House Republicans have pledged not to touch the two entitlement programs, but are focusing on a wide range deep spending cuts to smaller programs.

While still finalizing plans, the White House warned a House Republican proposal would upend the lives of many Iowans, citing reporting by The New York Times of a budget outline that would, among other provisions; add work requirements for food stamp and Medicaid beneficiaries; cut housing programs, including phasing out the Section 8 program that pays a portion of monthly rent costs for low-income people; and eliminate expansions to Medicaid under the Affordable Care Act.

Iowa expanded Medicaid coverage to low-income adults through the Affordable Care Act in 2013. Initially, the state used a waiver to implement an Iowa-specific version of Medicaid expansion, but that was abandoned in 2015 in favor of straight Medicaid expansion as called for in the Affordable Care Act, with a managed care approach that uses private insurers to coordinate care and provide coverage.

Eliminating that expansion would lead to 246,686 Iowans losing their health insurance coverage, according to enrollment data from the Centers for Medicare and Medicaid Services.

Biden last month spoke of the dangers of eliminating the Medicaid expansion, which the Affordable Care Act expanded in 39 states.

“And it includes millions of middle-class and working-class families who currently are covered by the ACA Marketplace,” Biden said. “Even if they did manage to keep their health insurance, it would cost them thousands of dollars more per year than it does now.”

Grassley also criticized the timing of the release of Biden’s budget proposal, a month after the statutory deadline.

“The delay will have a cascading effect of putting us way behind on the whole budget process,” Grassley said. “It puts us on a path once again of governing by cliff and by crisis.”

The Associated Press contributed to this report

Comments: (319) 398-8499; tom.barton@thegazette.com