L ast week, the Biden administration finalized a cut to Medicare Advantage. This was not only bad policy; it may also prove to have been bad politics.
Medicare Advantage (MA) funding will, effectively, be reduced by 0.16 percent for 2025. On paper, it looks like a 2.4 percent increase. But that turns negative when health-care inflation and an anticipated 6 percent rise in Medicare costs are factored in. It follows this year’s 1.12 percent cut.
The cut could reduce beneficiaries’ choices, as some insurers may leave certain markets. Insurers who stay may make changes, such as increasing cost-sharing benefits. If this were to drive seniors out of MA plans and into traditional Medicare, it would have serious consequences: MA plans are better at reducing hospitalizations and readmissions and harmful drug interactions. Additionally, the life of the Medicare trust fund would be extended by about 17 years if traditional Medicare performed as well as MA. In short, the cut to MA is unwise for both beneficiaries and taxpayers.
It is also unwise in an election year. There are more than 5.2 million MA enrollees across the swing states of Arizona, Georgia, Michigan, Pennsylvania, and Wisconsin. To see how politically perilous this could be for President Joe Biden, examine the below table.
The number of MA beneficiaries in each state far exceeds Biden’s 2020 victory margins. Of course, not every swing state would present a good opportunity for Trump to attack Biden on the MA cuts. Trump’s twelve-percentage-point margin among seniors in Georgia in 2020 may mean that there are few seniors left there for him to win over to surmount even a modest deficit of fewer than 12,000 votes.
Yet there is plenty of room for Trump to gain among seniors in Arizona and Michigan. If Trump holds all of the states he won in 2020, he’d have 235 electoral votes. Pick up the Grand Canyon and Wolverine States along with either Pennsylvania or Wisconsin, and Trump would exceed the 270 electoral votes needed to win.
It won’t be hard to translate the MA cut into something that seniors can easily relate to. A recent analysis by the Berkeley Research Group found that on average, seniors will pay an additional $33 a month in premiums and cost-sharing, nearly $400 a year.
Senator Rick Scott (R., Fla.) is already leading the charge.
“President Biden has no plan to protect Social Security, and now he just cut Medicare benefits. Biden’s war on seniors is disastrous — especially for seniors on fixed incomes who are already struggling with skyrocketing inflation,” he said in a press release. “The takeaway from Biden’s actions is clear: Democrats don’t give a damn about the 2.8 MILLION Florida seniors enrolled in Medicare Advantage who will see costs go up by nearly $400 a year.”
What’s worse for the Biden campaign is that the president inadvertently provided Republicans with ammunition during his State of the Union address. “If anyone here tries to cut Social Security or Medicare or raise the retirement age, I will stop them!” Biden proclaimed. The attack ad almost writes itself.
Biden has made a brainless move on Medicare. Expect Trump to take full advantage of it.