President-elect Donald Trump has put forward Dr. Mehmet Oz, a renowned heart surgeon and television personality, as his choice to lead Medicare and Medicaid. These critical government programs currently provide healthcare services to approximately 150 million Americans. This nomination raises questions about potential impacts for current and future beneficiaries of Medicare.
Dr. Oz, who needs Senate confirmation to become the next Administrator of the Centers for Medicare and Medicaid Services (CMS), is expected to bring a new approach to the programs. His long-standing relationship with Trump, as well as his previous role on Trump’s Council on Sports, Fitness, and Nutrition, suggest a close alignment in their healthcare strategies. Trump’s statement endorsed Oz as uniquely qualified to “Make America Healthy Again.”
However, there is skepticism about the nomination. According to STAT News reporter Lev Facher, both Dr. Oz and Robert F. Kennedy Jr., who would be Oz’s superior if confirmed, are considered unconventional choices for these roles. Andrew MacPherson, a partner at Healthsperien, noted that federal health insurance programs might face increased scrutiny under the Trump administration. Trump has assured voters that he will not reduce Medicare funding, promising to protect the program from excessive costs.
Potential Shift Towards Medicare Advantage Plans
Oz has shown a preference for Medicare Advantage plans, which are private alternatives to Traditional Medicare. With 54% of beneficiaries already enrolled in these plans, Oz may advocate for their expansion, aligning with his past support for Medicare Advantage during his Senate campaign. An article co-authored by Oz proposed a broader “Medicare Advantage for All” system, which would introduce a 20% payroll tax to fund the program.
Focus on Reducing Waste and Fraud
Trump emphasized Dr. Oz’s role in tackling waste and fraud within Medicare, which accounts for a significant portion of national healthcare spending. The U.S. Government Accountability Office reported over $100 billion in improper payments in 2023, highlighting the potential for cost-saving measures. Addressing these inefficiencies could extend the solvency of Medicare, which faces financial challenges by 2036.
Maintaining the $2,000 Drug Cost Cap
The Inflation Reduction Act’s $2,000 cap on out-of-pocket prescription drug costs for Medicare beneficiaries is expected to remain intact under Oz’s leadership. Despite recommendations to repeal the Act, experts like Bob Blancato believe this specific provision will not be altered.
Efforts to Control Prescription Drug Prices
Trump and Oz have both expressed a commitment to making prescription drugs more affordable. Oz has criticized regulatory barriers that contribute to high drug costs, suggesting that streamlining processes could lower prices. However, it remains uncertain whether they will continue the current policy of allowing Medicare to negotiate drug prices.
Changes to Nursing Home Staffing Rules
Oz’s role would also involve oversight of national nursing homes, where he might consider rescinding federal staffing standards introduced by the Biden administration, giving operators more flexibility in staffing decisions.
Potential Medicaid Reforms
Under Trump and Oz, Medicaid might undergo changes aimed at reducing costs, possibly through eligibility adjustments or funding shifts to block grants. These measures could alter the program significantly, impacting long-term care services for low-income Americans.
Possible Adjustments to the Affordable Care Act
While the Affordable Care Act is unlikely to be repealed, experts anticipate tweaks to certain elements, such as premium subsidies set to expire in 2025. Such changes could result in increased premiums for the 20 million people utilizing these subsidies.
Uncertain Future for Telehealth and Hospital at Home
Two areas of Medicare coverage remain uncertain: telehealth and Hospital at Home services. Both programs require legislative action by Congress and the President to extend their coverage beyond December 31, creating uncertainty about their future availability under Medicare.
