CBO: Republican tax bill could cut $25B from Medicare

The tax plan proposed by Congressional Republicans could end up stripping Medicare of $25 billion, according to analysis from the Congressional Budget Office.

The Office of Management and Budget keeps track of the estimated budgetary impacts of each bill, and if new legislation increases the deficit, the OMB is required to impose the pay-as-you-go budgetary rule. If legislators cannot offset the increases to the deficit, the OMB will issue a budget sequestration order that reduces spending and returns the deficit to its previous level. Under this sequestration, Medicare funding could be cut by $25 billion in 2018. 

Lawmakers could circumvent the rule with a bipartisan vote, but Democrats are hesitant to help Republicans avoid the cuts when they were not included in the bill's drafting process.

"While it is possible to avoid the [pay-as-you-go] enforcement cuts triggered by their added deficits, Republicans would need Democratic votes to do it, requiring them to abandon their go-it-alone partisan strategy, which is only leading them on a path to failure and to putting our country in danger," said Rep. Steny Hoyer, D-Md., according to The Hill.

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