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Kamala Harris did not vote for “cutting Medicare benefits” despite Trump’s claim

tabnews August 18, 2024
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Jacob Gardenswartz
| PolitiFact.com

Opinion: “As Vice President, Kamala Harris cast the deciding vote to cut Medicare by $273 billion. She voted to cut Medicare.”

During a campaign rally on July 24 in Charlotte, North Carolina, former President Donald Trump claimed that Vice President Kamala Harris was responsible for passing a bill in the U.S. Senate that would have cut Medicare spending by nearly $300 billion.

“As Vice President, Kamala Harris cast the deciding vote to cut Medicare by $273 billion,” Trump told rally attendees. “She voted to cut Medicare.”

Trump offered no further explanation as to which votes he was referring to or how he arrived at that number. A campaign spokesperson told KFF Health News in an email that Trump was referring to a statistic from a Wall Street Journal editorial by Tomas Philipson, a University of Chicago economist and former Trump administration official.

Philipson's op-ed argued that the Inflation Reduction Act – a sweeping climate and health care measure passed in 2022 that Harris cast the tie-breaking vote for – would harm Medicare patients by driving up costs. His article cited a Congressional Budget Office analysis showing that the measure's health care provisions would reduce the federal deficit by $237 billion over 10 years. “Most of that reduction comes from the program spending less on prescription drugs,” Philipson wrote.

But the government's reduced spending on Medicare programs would not result in the “cuts” to Medicare benefits that Trump implied, experts told KFF Health News. Several provisions of the prescription drug pricing law are widely viewed by health experts as beneficial to consumers and the government. Individual patients are expected to spend less out of pocket on their prescription drugs, while the government will reduce Medicare spending with no impact on benefits.

We've looked at the facts surrounding Trump's claim and the law's impact on Medicare. It reopens a long-running debate about Medicare savings versus cuts, and raises the question of whether lower spending automatically leads to cuts in benefits for Medicare beneficiaries.

Follow the numbers

Among the Inflation Reduction Act's many provisions are several aimed at reducing the cost of prescription drugs for older Americans and other Medicare beneficiaries.

The law caps the cost of insulin at $35 per month for most Medicare beneficiaries, sets caps on copayments for Part D drugs, and imposes penalties on drug companies that raise their prices faster than the rate of inflation. The law also empowers Medicare representatives for the first time to negotiate drug prices directly with drug manufacturers.

“The idea behind drug price negotiations is that Medicare can use its purchasing power to get a better price than what is currently negotiated for these drugs,” said Juliette Cubanski, deputy director of the Medicare Policy Program at KFF, a nonprofit health information organization that includes KFF Health News.

According to an analysis by the Congressional Budget Office, the nonpartisan federal agency that calculates the financial impact of new legislation, the Inflation Reduction Act's health care measures will have mixed effects on spending. Some measures, such as capping insureds' copayments for prescription drugs, are likely to cost the government more. But other measures, including drug price negotiations, are expected to save the government money. Overall, the Inflation Reduction Act's health care measures are expected to save taxpayers $237 billion over the next decade.

On the numbers: Trump said the bill would cut Medicare by $273 billion; he probably meant $237 billion.

Although the government is expected to spend less overall, benefits for recipients will not necessarily be cut, as Trump claimed. Most Medicare recipients will also likely see lower costs while benefits remain the same.

“There are big shifts in who is paying for what,” says Andrew Mulcahy, a leading health economist who studies prescription drug markets at the nonpartisan think tank Rand Corp. “But that doesn't mean they're getting less. If anything, they have better access to medicines.”

Cubanski agreed with Mulcahy, saying, “Cutting Medicare spending is not the same as cutting Medicare or cutting Medicare benefits. If you buy eggs every week and you can get them cheaper now, you're still getting the eggs, you're just getting them at a lower price.”

A year ago, the Centers for Medicare & Medicaid Services named the first 10 drugs it would focus on, but the exact savings from the price negotiations won't be known until the government and drugmakers reach agreements. The new prices for this first batch of drugs are scheduled to take effect in 2026.

It is unclear whether the government can negotiate significantly lower costs compared to current prices, especially since that task falls to pharmacy benefit managers (PBMs), who act as intermediaries in negotiations between pharmaceutical companies, insurers and pharmacies.

“I suspect the government won't be able to do much more than the PBMs for many of the drugs selected in the first year,” Mulcahy told KFF Health News.

The Medicare drug pricing program could have negative side effects. Philipson, for example, argued in his op-ed that the negotiations would “discourage companies from developing new drugs” and jeopardize older Americans' access to doctors because manufacturers and hospitals would likely be reimbursed less for their drugs and services.

Cubanski dismissed such concerns.

“The pharmaceutical industry certainly has a vested interest in sounding the alarm,” she said. “I think it's just too early to talk about the world collapsing in terms of pharmaceutical innovation.”

PolitiFact's verdict

Trump's statement is wrong both in terms of the hard numbers and his interpretation of them.

According to his campaign, Trump cited an analysis that the Inflation Reduction Act's health care reform would reduce the deficit by $237 billion – not $273 billion as the former president claimed. Regardless of the exact figure, several experts also rejected the notion that the savings would amount to a “cut” in Medicare benefits, as Trump claimed.

We rate Trump’s claim as false.

Sources:

  • Centers for Medicare & Medicaid Services, Fact Sheet: Revised Guidelines for the Medicare Drug Price Negotiation Program, June 2023
  • Centers for Medicare & Medicaid Services, Medicare drug price negotiations
  • Programme: Selected medicinal products for the first price application year 2026, August 2023
  • The Wall Street Journal, “How President Biden defeated Medicare,” July 9, 2024
  • Congressional Budget Office, Estimated Budget Effects of Act 117-169 to Prepare for a Reconciliation Under Title II of S. Con. Res. 14, September 7, 2022
  • Congressional Budget Office, How CBO estimated the budget impact of key prescription drug provisions in the Reconciliation Act of 2022, February 2023
  • C-SPAN, “Former President Trump campaigns in Charlotte, North Carolina,” July 24, 2024
  • Email exchange with Karoline Leavitt, national press secretary for Donald J. Trump for President, July 29, 2024
  • KFF Health News, “Trump is wrong to take sole credit for lowering insulin prices,” July 18, 2024
  • Telephone interview with Andrew Mulcahy, senior health economist at Rand Corp., July 26, 2024
  • Phone interview with Juliette Cubanski, deputy director of the Medicare Policy Program at KFF, July 29, 2024
  • United States Senate, “Roll Call Vote of the 117th Congress – 2nd Session,” August 7, 2022

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