No cuts to Medicare enacted yet

As a presidential candidate, Donald Trump pledged that he wouldn't cut Medicare, the federal health-care program that mainly serves Americans 65 and older.

So far, nothing has been enacted on Trump's watch that cuts Medicare benefits, said Erin A. Taylor, a policy researcher at the RAND Corp. "To my knowledge there has been no actual policy enacted yet during the Trump administration that would cut Medicare funding in such a way as to have significant impact on beneficiaries," she said.

However, Trump did offer a number of ideas for overhauling pieces of Medicare in his fiscal year 2019 budget proposal. Some, Taylor said, could leave Medicare beneficiaries better off, while some might not; it is hard to say at this time whether the gains for beneficiaries would outweigh the losses.

Over 10 years, Trump's 2019 budget proposal says it would cut Medicare spending by a cumulative $236 billion, including by reductions in "waste" and "fraud" and by changing the way drugs are priced and paid for in the program.

The largest cuts, Taylor said, would come from reducing Medicare's payments for uncompensated care in hospitals and from changing payments for graduate medical education. But "the effects of these changes may trickle down to beneficiaries in terms of changes in sites of service or effects on incentives on the parts of hospitals to provide care, but those effects may not be negative," Taylor said.

The changes to the Medicare Part D drug program would have a more direct impact on beneficiaries, though it's hard to tell how exactly the changes might flow through the system.

"On the positive side, requiring Medicare plans to pass through a proportion of manufacturer rebates to beneficiaries at the pharmacy could serve to reduce costs for beneficiaries," Taylor said, though she added that the system would be technically difficult to implement.

On the other hand, she said, the budget proposes not to count those cost reductions towards the calculation of the beneficiary's out-of-pocket spending. This means it would take beneficiaries longer to reach the catastrophic phase of the benefit.

Another possible benefit, at least for those with very high drug costs, is that those who reach the catastrophic phase would pay nothing for their prescriptions for the rest of the year, as opposed to the 5 percent share they would pay currently.

The budget also proposes to eliminate generic-drug cost sharing for low-income subsidy beneficiaries; this increases the government's cost burden, but it could encourage these beneficiaries to take needed medications, Taylor said.

A final potential negative: The budget proposes to reduce the number of drugs required to be covered on plan formularies. This could restrict the ability of beneficiaries to access the medicines they need, and may require them to go through an appeals process to gain coverage.

The budget proposal does call for $236 billion in Medicare reductions, which would contradict Trump's campaign promise. On the other hand, the budget proposal is a non-binding document, it includes some provisions that would benefit users of Medicare, and more than a year into Trump's presidency, nothing has been enacted that is contrary to his promise not to cut Medicare. So we rate the promise In the Works.