Republicans who want to overhaul entitlement programs Medicare and Medicaid will have to look to the House to take the first crack at it next year.
House Speaker Paul Ryan told radio show host Ross Kaminsky on Wednesday that he wants to revisit entitlement reform after tax reform is finished. But the last effort to tackle entitlements in Obamacare repeal failed in the Senate last summer, and a member of Senate leadership said that the House will have to take the first step at any reform bill.
“I don’t know that that is something that we talked about that over here, but my understanding is the House is considering it,” said Sen. John Thune, R-S.D., the third-ranking GOP senator.
Thune was asked if the Senate would take up an entitlement reform bill if the House passed one.
“If the House sends us something, yeah,” he responded.
Thune said that entitlement reform is “not a matter of cutting programs.”
“It is a matter of making them work better for future generations,” he said. “They are not sustainable along their current trajectory.”
Any entitlement reform would focus on Medicare, which provides healthcare for seniors, and Medicaid coverage for low-income and disabled people. Republicans have long said that spending on the programs is driving too much debt and deficits.
“We are gonna have to get back next year at entitlement reform, which is how you tackle the debt and the deficit,” Ryan said.
Medicare spending grew 3.6 percent in 2016 from 2015, with the U.S. spending $672 billion. For Medicaid, spending grew 3.9 percent to $565 billion in 2016, according to data from the Centers for Medicare and Medicaid Services.
The Congressional Budget Office predicted in March that deficits will rise from 2.3 percent of gross domestic product in 2017 to 9.8 percent in 2047. A major factor is entitlement spending such as Social Security and Medicare.
Ryan made his remarks less than a week after the Senate passed a version of tax reform legislation that the Joint Committee on Taxation estimates would increase the deficit by $1 trillion, even accounting for any changes to economic growth caused by the legislation.
Ryan bashed several projections that show the tax cuts would not pay for themselves, noting that estimates don’t take into account “pro-growth tax policies.”
He added Wednesday that the Obamacare repeal bill passed by the House was the “biggest entitlement reform ever passed by Congress.”
However, the Senate discarded that bill and drafted its own version. Support for that bill, called the Better Care Reconciliation Act, collapsed after concerns from senators in states that expanded Medicaid under Obamacare.
The Senate then pursued a “skinny” repeal bill that did not touch Medicaid and only repealed some of Obamacare’s most unpopular mandates.
The holdouts on the “skinny” bill have not weighed in on taking another run at entitlement reform.
“I’d have to look at the details of what the proposal is. That is just something I will have to examine,” said Sen. John McCain, R-Ariz., who voted against the “skinny” bill but did vote for tax reform.
“I have no idea what he is going to be proposing, so I can’t judge that,” added Sen. Susan Collins, R-Maine.
Collins joined McCain and Sen. Lisa Murkowski, R-Alaska, to defeat the skinny bill. All three come from states that expanded Medicaid.
It is not clear if an entitlement reform package can pass the Senate.
Ryan spokeswoman AshLee Strong told the Washington Examiner that talks on specific entitlement reform is “premature.” She noted that the legislative agenda for 2018 would be fleshed out during a January retreat for the House.
Because of a Senate tool being used to bypass Democratic-led filibusters, the House may have to take up any bill to overhaul the programs.
The procedural tool reconciliation lets the Senate pass a bill with only 51 votes instead of 60 needed to stop a filibuster. But to do that, the bill must originate in the House and reduce the deficit, among other requirements.
It appears likely that Republicans would use reconciliation to pass entitlement reform to avoid opposition from Democrats. Republicans also say they want to tackle Obamacare repeal again next year.
However, any use of reconciliation would leave out Social Security reform. The Senate is barred from using reconciliation to pass any bill that targets Social Security, meaning that overhauling the politically popular program would take 60 votes in the Senate.
Republicans face another obstacle, besides Democrats. President Trump has been reluctant to cut Medicare, even though he embraced Obamacare repeal bills that would have cut Medicaid.
“He has not shown as much interest, so we are working with the president on the entitlements that he wants to reform that he is supportive of,” Ryan said.