Johnson against deficit: these are his proposals for Medicare and Social Security

To many, the new Speaker of the House, Michael Johnson (R-LA), seems like he was plucked from obscurity. Never having chaired any important committees and only serving in Congress since 2017, Rep. Johnson was not on many pundits’ shortlist for the Speakership.

Before taking the gavel, the highest-ranking positions the Louisiana Congressman had held were the Vice Chair of the House Republican Caucus and the Chair of the Republican Study Committee (RSC). The RSC is a group of conservatives who believe in fiscal responsibility and traditional values. They create policies that align with their beliefs. However, their proposals regarding Medicare and Social Security have been met with opposition from moderate party members, Democrats, and advocates for healthcare and senior rights.

Adding to the pressure is the looming deadline to pass a budget and prevent a government shutdown, which puts House Speaker Johnson to the test of finding common ground in a deeply divided chamber in just a few weeks.

Where does Speaker Johnson stand on Medicare and Social Security?

The perspective of the new Speaker as it relates to his vision for Medicare and Social Security can be captured in the RSC’s report on the 2024 budget. The report accuses Presidnet Biden of cutting Social Security benefits by 23 percent for the more than 53 million people who receive them by allowing the Social Security Old Age and Survivor Trust Fund to fall into insolvency. However, the president has never advocated for such a policy, and it is the responsibility of Congress to ensure these sharp cuts are not enacted. The RSC report blames Democrats for inflation, which they say was “inflation, created by the reckless spending policies of President Biden and Congressional Democrats, has done vast damage to the trust fund’s solvency,” reads the RSC report, ignoring the fact that inflation is an issue that has faced economies across the globe. The committee argued that the 8.7% Cost-of-living adjustment (COLA) applied to social security benefits in 2023 contributed to the trust fund’s insolvency. The COLA is a legal requirement, and for many seniors living on a fixed income, not receiving a bump in their benefits could have been devastating as their purchasing power would have been eroded by higher prices, potentially forcing them into poverty.

RSC proposals for Social Security

The RSC has not given specific details on how to tackle the issue of Social Security in their report. However, they have suggested that increasing the retirement age is one way to address the problem. Although the report does not mention a specific age, it has been suggested by the Center for American Progress that the retirement age could be raised to 69 years old. This proposal would naturally lead to a reduction in benefit amounts for those who retire earlier, penalizing those who may have to leave the workforce due to physical limitations. The proposal also calls on the phase-out of “auxiliary benefits.” What are these benefits? One example of a recipient is the spouse of a retired worker who may not qualify to receive benefits on their own but is currently able to receive half of their spouse’s benefits. Many reasons keep people, particularly women, out of the workforce. The RSC says it would phase out these benefits for “high-income earners,” but again, it does not provide a dollar figure.

The RSC rejects proposals to lift the cap on payroll taxes that fund Social Security, which currently sits at $168,600. In other words, income above this level cannot be taxed. The group also opposes “debt-financed” transfers to the trust fund from which benefits are paid.

RSC proposal for Medicare

Like Social Security, Medicare also faces financial troubles that could begin to lead to a degradation in care for members in a little over a decade.

The RSC proposal centers on creating a “Fed Plan” that includes benefits included in Medicare Parts A, B, and D. So that these government plans can compete with those on the private healthcare market, subsidies would be created, the size of which “would be benchmarked to the cost of the Fed Plan, and Medicare would retain all of the current tools at its disposal to reduce costs and provide high-quality coverage.” Very few details are provided on how this proposal would lead to lower costs, and the healthcare advocacy organization Social Security Works has warned that the “‘premium support’ model [...] ends the Medicare guarantee.”

None of these proposals have the support of Democrats, which makes a budget that includes them a mission set up for failure when it comes to passage in the Senate. Additionally, the GOP caucus remains divided, and if Democratic votes are needed in the House, these proposals serve as a poison pill that will