A day rarely goes by without a new story on the titanic power struggle between the House Democrats and the White House. Yet, in a move that has been reported by precisely no one, the Trump Administration ignored a congressional demand to submit legislation to… cut Medicare.
Record Scratch
No, its not fake news. It’s Title VIII of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Medicare Modernization Act/MMA).
The Medicare Modernization Act most notably created Medicare Part D, an expensive and unfunded expansion of Medicare to cover prescription drugs. MMA also included a cost containment provision to address concerns over growth in general revenue spending for Medicare versus dedicated Medicare revenues. Congress was worried that rather than being financed with dedicated revenue sources – namely the Medicare payroll tax – more and more of the Medicare program would be funded with general funds (i.e. income taxes and debt).
The cost containment provision requires the Medicare Trustees to issue an annual report which flags whether general funding is projected to cover more than 45 percent of total Medicare costs any time over the next seven years – a level that Congress considered excessive and would need to be addressed. If the 45 percent limit is exceeded in two consecutive reports, that triggers a requirement that the President must submit legislation to Congress to control program costs within 15 days of the Presidential Budget submission. Congress then must act on the legislation on an expedited basis.
This year’s Medicare Trustees Report found excess general funding projections for the 2nd consecutive year, triggering the MMA Medicare cost containment clause necessitating a Presidential proposal to deal with the excess general funds. The deadline for submission came and passed last week.
While the Trump budget did make some news by offering a series of reforms to Medicare, it quietly tucked a statement in the analytical perspectives attachment that it’s going to take a pass on fulfilling the Presidential requirement per the MMA trigger provision, claiming that “in accordance with the Recommendations Clause of the Constitution…the Executive Branch considers a requirement to propose specific legislation to be advisory.”
Article II Section 3 of the Constitution states that “the President shall from time to time give to the Congress Information of the State of the Union, and recommend to their Consideration such Measures as he shall judge necessary and expedient.” The executive branch asserts that Congress cannot force the President to make a recommendation that he does not personally find to be “necessary and expedient.”
When signing the MMA in 2003, President Bush singled out the trigger clause and said that it would be construed “in a manner consistent with the President’s constitutional authority to supervise the unitary executive branch and to recommend for the consideration of the Congress such measures as the President judges necessary and expedient.” President Obama ignored the trigger warning each year from 2008 to 2013, stating that the trigger warning was “advisory and not binding.” A decision that was criticized by some Republican members of Congress who are also notably silent on the topic now that it’s a Republican in office.
While the executive branch has traditionally swatted away these requests for legislation, Congress has a strong case to fight back. The founders included the recommendation clause because they wanted to clearly establish that the President has the ability to submit legislative recommendations to Congress without causing “umbridge or cavil.”
In other words, the clause in question establishes a right rather than a substantive source of authority. This right would only be violated if Congress prevents the President from making recommendations. In the case of the Medicare trigger, Congress is simply asking for legislation, but the contents remain under his discretion.
The Congressional Research Service (CRS) succinctly affirms the strength of Congress’s position, stating “it is unlikely that Congress imposes an excessive burden on the President where it merely directs the President to submit a proposal….Whereas the Department of Justice may assert that “any bill purporting to require the submission of recommendations is unconstitutional,” no judicial decision has accepted such a broad proposition.”
Just recently, Congress exerted its Constitutional authority over the power of the purse when they passed a resolution of disapproval over President Trump’s emergency declaration to direct $3.6 billion towards border wall funding, prompting the first veto of his presidency. While the clash oozed with politics, the question of whether a president can skate around the spending authority of Congress is a fundamental one. After decades of ceding more and more authority over to the judicial and executive branches – Congress decided to protect its spending authority.
Though the debate over the power of the purse in the border wall debate is monumental, its impact on America’s financial future pales in comparison to the Medicare financing trigger. Medicare is the fastest growing major spending category in the federal budget. The gap between dedicated payroll taxes and expected expenditures is a whopping $37.3 trillion over the next 75 years.
That gap, which will be filled by general fund revenues, is the reason why Congress included the trigger mechanism in 2003. Over half of all Medicare expenses are projected to be paid for with general funding over the next 75 years – a punishing lien against younger generations.
Congress undoubtedly has the prerogative to challenge President Trump’s decision to ignore their request for a Medicare savings proposal. There is also the urgent need to patch our nation’s fiscal ship which is being sunk by massive unfunded entitlements.
However, unlike the border wall fight, Congress seems unlikely to pick this fight because they are afraid that it would be used against them in 2020 (see: every push-grannie-off-the-cliff scare tactic). House Democrats are hellbent on finding any and all cases of Trump violating laws. Yet, in this blatant example of the president ignoring a Congressional request outlined in public law, they will make an exception.
There is a silver lining. In the absence of Presidential legislation, a Congressman can still utilize the expedited procedures to gain consideration and debate over a bill that will address excess general funding for Medicare. This is especially important in the Senate, where rules often make it difficult to force a debate over an issue that the Majority Leader does not want to take up.
It will only take one Senator to initiate this action and spur a debate over how our nation is going to pay for all its promises without leveling an impossible burden on younger generations. Who is up for the challenge?
