March 7 (Reuters) – U.S. President Joe Biden will seek to raise Medicare taxes on high-income earners and push for more drug price negotiations to help keep the federal health insurance program more affordable. menos 2050 as part of his budget proposal this week, the White House said.
His idea quickly ran into opposition in Congress, where Senate Republican leader Mitch McConnell predicted it would not pass the Republican-controlled House of Representatives.
The tax increase from 3.8% to 5% of earned and unearned income above $400,000 is part of a package of proposals aimed at extending the solvency of Medicare’s Hospital Insurance Trust Fund for at least 25 years. , the White House said in a statement on Tuesday.
“We’re going to ask the wealthiest to pay more than their fair share, to strengthen Medicare for all over the long term,” Biden said in a New York Times guest essay published Tuesday.
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Biden sought to link Republicans to the idea of cutting funding for the insurance program for the elderly and disabled as part of negotiations to increase the $31.4 trillion debt limit of the United States. Biden’s Democrats control the Senate, but Republicans have a slim majority in the House.
The Democratic president promised to offer his vision for Medicare funding and challenged Republicans to offer their own.
“Thankfully the House is Republican,” McConnell told reporters at a press conference.
“More tax increases, more spending. All the Americans can thank the Republican House for not seeing the light of day,” he said.
The president is scheduled to unveil his budget on Thursday, including a speech in Philadelphia to highlight his plan.
Biden called the rate increase “modest,” adding to the Times: “When Medicare was passed, the richest 1% of Americans had no more than five times the wealth of the bottom 50 percent combined, and it is reasonable that some would make the changes to reflect that reality now.”
His proposal also seeks to close loopholes that allow high earners to shield their income from taxes, the White House said.
The Inflation Reduction Act, passed by Democrats last year, allows Medicare to negotiate prices for expensive drugs. The budget proposal would allow Medicare to negotiate prices for more drugs and do so soon after they are launched, saving $200 billion over 10 years, the White House said.
Without action, the latest Medicare Trustees Report projects that the trust fund will be insolvent by 2028.
Some House Republicans say Medicare along with Social Security, which delivers retirement and disability benefits, should be part of any budget negotiations. While popular, the two programs account for about one-third of federal spending, according to the Congressional Budget Office, and are expected to grow as the US population ages.
Reporting By Jarrett Renshaw; additional reporting by Richard Cowan and Katharine Jackson; Editing by Shri Navaratnam Chizu Nomiyama, Aurora Ellis
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