MONDAY, Feb. 5 (HealthDay News) -- President Bush's proposed $2.9 trillion federal budget, unveiled Monday, calls for health care spending cuts, including a major five-year reduction in Medicare expenditures to slow the program's annual growth rate from 6.5 percent to 5.6 percent.
The proposed total cuts of $78 billion for Medicare and Medicaid -- the federal health insurance programs for the elderly and lower-income Americans, respectively -- are part of Bush's plan to eliminate the federal deficit by 2012. However, Medicare spending would increase nearly $454 billion in 2008, an increase of $28 billion over this year, before the proposed reductions take effect.
The total 2008 budget for federal health care, administered by the U.S. Department of Health and Human Services, would be nearly $700 billion for the fiscal year that begins Oct. 1, an increase of more than $28 billion over 2007. Medicare makes up 55.4 percent of the HHS budget, while Medicaid accounts for 29 percent.