Democrats are calling on GOP leaders to discard Medicaid cuts and instead address Medicare Advantage "upcoding" to tackle federal waste. In a letter to Senate Majority Leader John Thune and House Speaker Mike Johnson, more than 40 lawmakers called for action against private insurers tampering with patient diagnoses to increase profits.
What Happened: The lawmakers cited reports that Medicare overpaid private insurers by $50 billion in 2024 for unverified diagnoses, as per The Hill. "Where there is widespread agreement is the need to address waste, fraud, and abuse by private, for-profit insurance companies," they wrote, referring to $83 billion in excess payments in comparison with traditional Medicare.
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Why It Matters: The budget cuts sought by Republicans could harm working-class Americans who depend on welfare programs for healthcare access, according to Democrats. "Moving forward with this dangerous plan… would be a man-made disaster for the health of the nation and the economy," the letter says.
A new Congressional Budget Office analysis indicates that Republican budget proposals could remove Medicaid coverage from 2.3 to 8.6 million Americans. The plans include cutting funds to states that expanded Medicaid under the ACA. This could potentially leave 5.5 million without coverage by 2034, including 2.4 million who would lose all health insurance.
Last month, President Donald Trump said he would veto any legislation that reduces Social Security or federal health programs, emphasizing that the only reforms he supports are those addressing "waste, fraud and abuse" in Medicaid.
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