Project 2025 Unveiled: VERIFYing the Future of Medicaid and Medicare

Project 2025, led by the Heritage Foundation, proposes significant changes to Medicaid and Medicare, stirring concern among beneficiaries and policy analysts.

Over the past month, VERIFY received numerous inquiries about Project 2025’s potential impact on these vital healthcare programs. The plan could indeed affect Medicaid’s and Medicare’s structure and funding.

Several readers inquired about Medicaid cuts specifically.

QUESTION #1: Does Project 2025 propose cuts to Medicaid?

ANSWER: Yes, Project 2025 proposes cuts to Medicaid.

Project 2025 does not seek to eliminate Medicaid but aims to reduce its funding and change eligibility criteria. The plan, detailed in the “Mandate for Leadership: The Conservative Promise,” portrays Medicaid as an unsustainable burden on states, failing vulnerable populations.

The plan includes policies to lower costs, such as adding work requirements for “able-bodied” beneficiaries to qualify for coverage and implementing a lifetime cap on benefits. This could impact the 18.5 million Medicaid beneficiaries who qualified based solely on income in 2021, according to the Center for American Progress.

Roger Severino, the author of Project 2025’s HHS chapter, suggests that states should be encouraged to raise premiums and cost-sharing for higher-income Medicaid enrollees. He proposes capped federal grants to states to promote saving and healthcare quality improvement.

Currently, federal funding for Medicaid is based on a fixed percentage of costs without caps. Experts from Georgetown University’s Center for Children and Families warn that the proposed capped grants could reduce overall federal support for Medicaid.

QUESTION #2: Does Project 2025 propose cuts to Medicare?

ANSWER: No, Project 2025 doesn’t propose cuts to Medicare. However, some proposals may increase costs for beneficiaries.

Project 2025 makes no suggestion to narrow eligibility or reduce funding for Medicare, which serves people 65 or older and some younger individuals with specific conditions. However, the plan advocates making Medicare Advantage the default plan, ending Medicare Part D price negotiations, which critics argue could increase costs for seniors.

Medicare Advantage, privately managed and federally funded, differs from traditional Medicare, which is publicly funded for specific services. Severino highlights Medicare Advantage’s high performance ratings, but critics like the Center for Economic and Policy Research contest the evidence supporting superior outcomes compared to traditional Medicare.

A 2022 KFF review shows mixed results: Medicare Advantage excels in preventive services and lower readmission rates, but traditional Medicare outperforms in hospital quality and skilled nursing care. Project 2025 also calls for the repeal of Medicare’s prescription drug price negotiation program, potentially costing seniors $400 annually in drug savings, as per the Center for American Progress.