June 1 Medicare payments at risk if debt ceiling not resolved

The federal government could be unable to make scheduled Medicare payments as soon as June 1 if Washington does not reach a deal to avoid a debt ceiling breach. 

According to a May 23 analysis from the Bipartisan Policy Center, the federal government is projected to spend $101 billion on June 1, including $47 billion in Medicare payments. If lawmakers do not extend the debt ceiling, the government will not have enough revenue to pay all of its obligations on time. 

The government would also be unable to pay billions in Medicaid payments beginning June 2, according to the analysis. 

The Bipartisan Policy Center's report cautions it is impossible to predict an exact "X date" — the day the treasury will no longer have sufficient funds to pay all of its bills on time. Treasury Secretary Janet Yellen has said this date could be as early as June 1. 

Katherine Hempstead, PhD, senior policy adviser at the Robert Wood Johnson Foundation, told The Hill May 18 that Social Security and Medicare payments will likely be impacted in most debt breach scenarios. 

"Medicare is the financial backbone of our healthcare system, so the consequences to hospitals and healthcare providers will be profound," Dr. Hempstead said. 

Negotiations to address the debt ceiling between House Speaker Kevin McCarthy and President Joe Biden are ongoing as a potential default approaches. 

Mr. McCarthy has said tougher Medicaid work requirements are a "red line" in the negotiations.

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Top 40 articles from the past 6 months