CRS Report: Medicare: FY2009 Budget Issues Share Share LinkedIn X Facebook Permalink By Elder Law Prof Blog February 21, 2008 Abstract: EachFebruary, the President submits a detailed budget request to Congressfor the following federal fiscal year, along with projections for thefive-year budget window. The budget informs Congress of the President’soverall federal fiscal policy, based on proposed spending levels,revenues, and deficit (or surplus) levels. The budget request lays outthe President’s relative priorities for federal programs, such as howmuch should be spent on defense, education, health, and other federalprograms. The President’s budget may also include legislative proposalsfor spending and tax policy changes. While the President is notrequired to propose legislative changes for those parts of the budgetthat are governed by permanent law, such as Medicare benefits, thesechanges are generally included in the budget. The President’s 2009budget estimates current law Medicare net outlays of $413 billion inFY2009. The budget includes Medicare legislative proposals withestimated savings of $12.2 billion in FY2009 and $178 billion over thefive-year budget window. The President’s budget also includes Medicareadministrative proposals with estimated savings of $645 million inFY2009 and $4.7 billion over the five-year budget window, which bringsthe estimated savings from the total Medicare budget proposals to $12.8billion in FY2009 and $183 billion over the fiveyear budget window.Proposals include savings achieved through reductions in many of theMedicare payment updates. The Medicare Prescription Drug, Improvementand Modernization Act of 2003 (MMA, P.L. 108-173) requires the MedicareBoard of Trustees to examine and make a determination if generalrevenue Medicare funding is expected to exceed 45% of Medicare outlaysfor the current fiscal year or any of the next six fiscal years. Anaffirmative determination in two consecutive annual reports isconsidered to be a Medicare funding warning in the year in which thesecond report is made. The President has indicated that he intends tosubmit the required legislative proposal, due within the 15-day periodfollowing the budget submission to Congress. As part of the budget, thePresident has proposed reducing Medicare provider payments by 0.4%beginning in any year that the general revenue Medicare funding isexpected to exceed 45% of Medicare outlays. This reduction wouldincrease each year, until the percentage falls below the 45% triggerlevel. This report will be updated. Get it NOW!!! Posted in: Medicare