Consequences of Ryan budget for Louisiana
Rep. Paul Ryan's budget, which the House passed earlier this year, does not work for Louisiana. His proposal would spend 21 percent less than current funding levels for the next 10 years—forcing cuts to programs that Louisiana families depend upon including: Medicare, education, infrastructure and disaster preparedness.
Rep. Ryan’s plan is shortsighted and wrongheaded. Instead of investing in Louisiana's middle class families, it puts tax cuts for those making more than $1 million per year in income first.
See how Rep. Ryan's budget would negatively impact Louisiana's middle class families below.
- IMPACT OF CUTS ON STATE AND LOCAL BUDGETS: The Ryan Budget cuts non-defense discretionary spending by 22 percent in 2014. That’s on top of the cuts imposed by the Budget Control Act. One-third of this non-discretionary funding goes to state and local governments for education, law enforcement, water treatment and disaster response. In 2014 alone, state and local governments would lose nearly $28 billion. (Source: Center on Budget and Policy Priorities.)
- IMPACT OF THE RYAN BUDGET ON EDUCATION: The Ryan Budget would cut non-defense discretionary spending by 5.4 percent in 2013 and 19 percent in 2014. Assuming these cuts are distributed equally across all federal programs, including local education agencies, these cuts translate to $15.6 million in education spending cuts. That would mean reduced or eliminated services for 25,960 Louisiana in 2013 and $54.9 million in cuts impacting 91,342 Louisiana students in 2014. (Source: Office of Management and Budget. Information compiled by the National Education Association.)
- IMPACT OF CUTS ON INFRASTRUCTURE: Currently, 5,345 federal highway bridges and 62,181 bridges along state and local roads remain at risk for collapsing. Rep. Ryan’s budget would cut funding levels for inspections and repairs “by an average of 7.5 percent annually over 10 years. Drivers would continue to cross tens of thousands unsound bridges that could collapse without warning.” (Source: Third Way, a nonpartisan think tank that advocates for private-sector economic growth.)
- IMPACT OF CUTS ON HURRICANE PREPARATION & RESPONSE: Cuts imposed on the National Oceanic and Atmospheric Administration (NOAA) through Rep. Ryan’s draconian budget proposal would prevent the agency from finishing its next scheduled weather satellite on time. In addition, NOAA’s ability to monitor the weather would be significantly disrupted. This would have a major impact on hurricane response. According to Third Way, “Governors and mayors would have to order evacuations for areas twice as large or wait twice as long for an accurate forecast. If they err on the side of safety, that could mean twice as many evacuees—2.3 million more—for an Irene-sized East Coast hurricane.” (Source: Third Way)
- IMPACT OF CUTS ON AIR TRAVEL: If Congress applied Ryan’s proposed budget cuts across-the-board in the transportation budget, the Federal Aviation Administration would lose more than 3,262 air traffic controllers; add 3,092 flight cancellations and 68,683 delays annually. (Source: Third Way)
- IMPACT OF CUTS ON INNOVATION: Rep. Ryan’s budget would cut funding for funding for general science, space and technology by 6.6% over 10 years. A proportional decline in discoveries leading to new products would mean the loss of one of every 15 inventions from federally funded research through the National Science Foundation and the Department of Energy. (Source: Third Way)
- IMPACT OF CUTS ON STATE AND LOCAL BUDGETS: The Ryan Budget cuts non-defense discretionary spending by 22% in 2014 on top of the cuts imposed by the Budget Control Act. One-third of this non-discretionary funding goes to state and local governments for education, law enforcement, water treatment and disaster response. According to CBPP, in 2014 alone, state and local governments would lose nearly $28B.
- IMPACT OF CUTS ON TAX COLLECTION AND THE DEBT: Rep. Ryan’s budget would reduce funding for general government, which includes Internal Revenue Service (IRS) enforcement, by 29.2%. If the IRS took its full share of the cuts, it would have 5,609 fewer revenue agents and officers looking for tax cheats. That would result in a $16.1 billion reduction in tax revenue. With less revenue, deficits would rise, as would taxpayer-financed interest on the debt. With Ryan’s proposal, each U.S. household would be forced to finance $110 to cover what tax cheats would not pay. (Source: Third Way)
IMPACTS ON MEDICARE AND LOUISIANA
“Access to affordable, life-affirming health care that respects religious freedoms remains an urgent national priority. Rising health care costs contribute in major ways to increased government spending. We warn against shifting rising health care costs to vulnerable seniors, people with disabilities, and those who are poor, without controlling these costs.” – Letter to U.S. House of Representatives from the U.S. Conference on Catholic Bishops, March 6, 2012
- More than 690,000 Louisiania seniors depend on Medicare to provide quality health care. But starting in 2023, Rep. Ryan’s budget proposal would change Medicare as we know it.
- Under Ryan’s plan, Louisiana seniors would receive a voucher to purchase either private insurance or traditional Medicare. There are more than 654,375 Louisianans who are now between the ages 47-56 who, instead of getting Medicare as we know it when they retire, would only get a voucher to purchase their insurance. (Sources: Center on Budget and Policy Priorities, U.S. Census Data, Kaiser Family Foundation, National Committee to Preserve Social Security and Medicare.)
- Under the Ryan plan, in 2023, the first year the voucher would apply, total health care expenditures for a typical 65-year-old would be almost 40 percent higher with private coverage than they would be with a continuation of traditional Medicare. Seniors would have to pay an additional $6,400 each year for their health care and prescription drugs. (Source: Congressional Budget Office.)
- 533,000 Louisiana seniors would pay more for preventive services if the Affordable Care Act (ACA) is repealed, as proposed in the Ryan plan.
- Repeal of ACA would force 74,644 Louisiana seniors back into the Prescription Drug “Donut Hole.” The Ryan budget would “re-open” the prescription drug donut hole – costing the average senior who falls into the donut hole almost $12,000 between 2012 and 2020. The “donut hole” forces seniors to pay the full cost of their prescription drugs after their yearly drug expenses exceed $2,840, and full coverage doesn’t resume until total drug spending hits $6,447 for the year. Since health reform was signed into law, more than 74,600 Louisiana seniors have saved $46 million on prescription drugs. (Source: Dept. of Health and Human Services.)
- The cost to Louisiana seniors from re-opening the “donut hole”: $571/person/year in prescription drug costs.
IMPACTS ON MEDICAID AND LOUISIANA
“Our nation has an obligation to address the impact of future deficits on the health of the economy, to ensure stability and security for future generations, and to use limited resources efficiently and effectively. A just framework for future budgets cannot rely on disproportionate cuts in essential services to poor persons; it requires shared sacrifice by all, including raising adequate revenues, eliminating unnecessary military and other spending, and addressing the long-term costs of health insurance and retirement programs fairly.” – Letter to U.S. House of Representatives from the U.S. Conference on Catholic Bishops, March 6, 2012
- Shifting to a block grant system would sharply shift costs to states, beneficiaries, and health care providers. States would have to offset these cost shifts by either boosting their own contributions to Medicaid or making deep cuts to eligibility, health and long-term care services, and provider reimbursement rates. Louisiana would lose up to $39.2 billion in federal Medicaid support between 2012 and 2021 under the Ryan plan.
- The Ryan plan would cut $8.6 billion in health care for Louisiana seniors by slashing Medicaid. In Louisiana, more than 259,700 seniors and disabled currently rely on Medicaid for their health care needs. While Medicare doesn’t cover longterm care, 30% of Medicaid spending in Louisiana provides this critical care for seniors, and is often the only avenue they have to get the care they need. The cost of longterm care can be financially devastating to seniors and their families, with nursing home costs averaging $52,925 in Louisiana for a private room.
- The Ryan plan would shift costs to state taxpayers, slashing health benefits in Louisiana by up to $39.2 billion over the next 10 years. This includes $16.8 billion in federal investments and $22.3 billion to expand eligibility in the state.
- Louisiana would receive far less federal investment than other states under Rep. Ryan’s proposed block brant plan. Louisiana Medicaid expenditure levels are relatively low ($4,670 per enrollee) compared to the US average ($5,337 per enrollee). Because the block grant funding levels are based on current state Medicaid spending, Louisiana would receive less block grant funding than other states.
- Nationally: The Ryan Budget includes $2.4 trillion in reductions from Medicaid and other health care for people with low or moderate incomes. The plan calls for Medicaid cuts of $810 billion, plus savings of $1.6 trillion from repealing the health reform law’s Medicaid expansion and its subsidies to help low- and moderate-income people purchase health insurance. (Source: Center on Budget and Policy Priorities.)