Analysis of the Continuing Resolution (CR) Changes

Detailed Breakdown of Increases and Decreases in Key Programs

congressional funding discussion table and government buildings

Highlights

Veterans' Affairs: Increased funding for healthcare and expanded copayment authorities.
Social Security: A guaranteed 2.5% cost-of-living increase issued for all beneficiaries.
Medicare & Medicaid: Adjusted premium and deductible amounts for Medicare, with Medicaid protections against certain cuts.

Overview of Key Provisions in the Continuing Resolution (CR)

The Continuing Resolution (CR) currently under consideration in Congress represents a comprehensive measure intended to ensure that critical programs in the U.S. continue to operate efficiently through the next fiscal period. The CR includes detailed provisions that affect several key areas: Veterans' Affairs, Social Security, Medicare, and Medicaid. In each of these areas, the resolution outlines specific increases and, in some cases, holds funding steady or adjusts other aspects in a manner that can be interpreted as a decrease relative to previous trends or planned changes. The following analysis details each of these areas, providing a line-item review of how the CR aims to alter funding and program parameters for these vital services.

Veterans' Affairs

This category encompasses various initiatives related to the provision of healthcare and other benefits for U.S. veterans. Several important changes have been negotiated and included in the CR:

Increases and Enhancements for Veterans

Funding Increases: One of the most critical provisions is the considerable infusion of funding intended to safeguard veterans’ healthcare services. The CR includes a notable increase by approximately $6 billion, which is aimed at bolstering veterans' healthcare accounts to prevent shortfalls. This funding is essential in maintaining the quality and continuity of services provided by the Department of Veterans Affairs (VA).

Copayment Authority Extension: Additionally, the CR extends the VA’s authority to collect copayments from eligible veterans who receive hospital or nursing home care. This extension is valid through the fiscal year 2025, ensuring that the VA has expanded capacity to manage and potentially improve its revenue streams, which in turn support veteran healthcare services.

Broad Service Provision: By enabling enhancements in healthcare account funding and extending regulatory authorities, the CR supports broader initiatives including continued access to comprehensive health services. Moreover, these measures include assumptions of modest pay increases for VA civilian employees (around 2%), aiding in retention and improved service delivery within the department.

Social Security

The CR ensures continuity for Social Security benefits with specific alterations that guarantee adjustments reflecting current economic conditions.

Cost-of-Living Adjustments (COLA) and Beneficiary Provisions

COLA Increase: A central provision for Social Security is the implementation of a 2.5% cost-of-living adjustment (COLA). This increase is targeted to ensure that the benefit checks of approximately 68 million recipients keep pace with inflation and rising living costs. The magnitude of this adjustment reinforces the commitment to social safety and economic stability for beneficiaries.

Income and Earnings Thresholds: For individuals earning credits toward future benefits, the CR also revises necessary income thresholds. In 2025, one Social Security credit is earned on wages or self-employment income of \$1,810, while earning four credits (or a full benefit year) will require cumulative earnings of \$7,240. Furthermore, the earnings exempt from the retirement earnings test is set at \$23,400 per year for individuals under full retirement age.

No Reductions in Direct Benefits: Importantly, there are no direct cuts to Social Security benefit payments in the CR. This maintenance of benefit levels provides certainty and predictability that reinforce retirement planning for current and future beneficiaries.

In summary, while the CR does not engage in any decreases for Social Security, it features robust adjustments that secure a progressive, inflation-adjusted increase in pay, ensuring that Social Security benefits remain responsive to the cost-of-living changes.

Medicare

Medicare, a crucial program for millions of Americans, is also subject to careful adjustments under the CR. The resolution includes a combination of increases and planned cost adjustments to various components of the program.

Premium Adjustments

Medicare Part B Premium Increase: For 2025, the standard monthly premium for Medicare Part B will rise to \$185. This represents an increase of \$10.30 from the previous year’s premium of \$174.70. The adjustment reflects the rising costs of healthcare delivery and seeks to allocate resources more effectively to manage care services.

Deductibles and Other Costs

Annual Deductible Adjustments: Medicare Part B deductibles are also affected by the resolution. In 2025, the annual deductible for beneficiaries increases from \$240 to \$257, an adjustment of \$17. This small increase is consistent with the general trend of increasing healthcare costs and aims to help offset rising expenditures.

Medicare Part A Inpatient Deductible: Additionally, the inpatient hospital deductible under Medicare Part A will see an increase. The deductible for hospital admissions is set to rise to \$1,676—a \$44 increase from the previous year’s amount of \$1,632.

Service Enhancements

Extension of Telehealth and Other Services: The CR includes provisions that extend several key services, such as telehealth, throughout the 2025 fiscal year. These measures ensure that beneficiaries continue to have access to modern and flexible health care options which have become indispensable, especially in light of evolving healthcare dynamics.

Funding Adjustments for Future Improvements: Beyond immediate premium and deductible changes, the resolution also sets the stage for increased funding for various Medicare-related improvement initiatives starting in the following fiscal year, particularly through the Medicare Improvement Fund beginning in FY2026. These forward-looking adjustments aim to bolster the resilience and capacity of the system.

Collectively, these changes in Medicare reflect a synthesis of cost adjustments and enhanced care provisions designed to balance the financial viability of the program with the critical need to provide accessible health care for seniors and eligible disabled individuals.

Medicaid

Medicaid, a program delivering healthcare services to economically vulnerable populations, sees actions in the CR that are designed to stabilize funding and service provisions.

Protection Against Funding Cuts

Elimination of Medicaid DSH Cuts: One of the prominent features of the CR is the elimination of the Medicaid Disproportionate Share Hospital (DSH) cuts through September 30, 2025. By eliminating these cuts, the CR helps to ensure that hospitals serving a large number of Medicaid recipients continue to receive adequate funding, which is crucial for maintaining community health services.

Future Funding Discussions

Potential Future Adjustments: While the CR itself does not impose direct decreases in Medicaid funding, there are discussions related to future Medicaid policies. There are considerations related to potential adjustments such as work requirements or changes in eligibility rules that could impact Medicaid enrollment and spending, but these are not finalized within the CR. Therefore, the current measure largely focuses on maintaining stability for Medicaid.

Comprehensive Table of CR Changes by Program

Program	Line Item	Change	Details
Veterans' Affairs	Healthcare Funding	Increase	\$6 billion boost to support healthcare accounts, ensuring service continuity.
	Copayment Authority	Extension	Extends authority to collect copayments for hospital and nursing home care through FY2025.
	Employee Pay Increase	Increase	Assumed 2% increase in pay for VA civilian employees.
	Additional Measures	Enhancement	Includes broader enhancements to ensure veterans' benefits continuity.
Social Security	COLA	Increase	2.5% cost-of-living adjustment ensures increased benefit checks for 68 million beneficiaries.
	Credit Earnings	Adjustment	One credit at \$1,810 and four credits at \$7,240; earnings exempt threshold of \$23,400.
	Direct Benefits	No Change	Maintains existing benefit levels without cuts.
Medicare	Part B Premium	Increase	Monthly premium increased to \$185 (\$10.30 higher than 2024).
	Part B Deductible	Increase	Annual deductible increased to \$257, up \$17 from prior year.
	Part A Inpatient Deductible	Increase	Inpatient hospital deductible increased to \$1,676 (\$44 increase).
	Service Extensions	Extension	Continued access to telehealth and other critical services through FY2025.
Medicaid	DSH Cuts	Elimination	Eliminates Medicaid Disproportionate Share Hospital cuts through Sept. 30, 2025.
Medicaid	General Funding	Stability	Maintains current funding levels with potential for future policy adjustments.

Detailed Discussion

Veterans' Affairs: Funding and Policy Enhancements

The provisions addressing Veterans' Affairs in the CR are primarily focused on ensuring that the services rendered by the VA are both sustainable and sufficiently funded. The inclusion of an additional \$6 billion significantly strengthens the financial base used for veterans' health services, while the extension of the VA’s authority to collect copayments guarantees flexible revenue generation throughout FY2025. Such measures are imperative in maintaining the continuity of healthcare services for veterans—including disability compensation, health care benefits, and supportive services. In addition, modest pay increases for VA employees help in retaining skilled personnel who are essential in managing an increasing range of services.

These enhancements not only guarantee immediate relief for veterans currently reliant on these services but also lay the groundwork for long-term improvements in service delivery. This strategic allocation of resources ensures that the health needs of veterans will be met without interruption, reflecting the commitment of Congress to honor and support those who have served the nation.

Social Security: Emphasis on Stability and Growth

With the main thrust being a robust 2.5% cost-of-living adjustment, Social Security is poised to protect the financial security of millions of Americans against inflation. Maintaining this adjustment ensures that beneficiaries can better manage rising living costs. By also establishing updated guidelines for accumulating work credits (with specified income thresholds), the CR not only protects current beneficiaries but also adjusts the framework under which future entitlements will be determined. This multifaceted approach underlines a commitment to both immediate and long-term beneficiary security in response to economic fluctuations.

Moreover, since there are no reductions in the direct benefits, Social Security continues to be an unwavering financial support system. This stability is crucial as it underpins retirement planning and provides a bulwark against economic uncertainties faced by a significant segment of the American population.

Medicare: Adjusting Cost Sharing and Service Provision

Medicare’s adjustments, particularly in cost-sharing components such as premiums and deductibles, reflect a necessary recalibration in the face of rising healthcare costs. The increase in the monthly premium for Part B and the associated adjustments for deductibles and inpatient hospital costs are measures intended to keep pace with the increased operational costs of providing health care services. These adjustments, while imposing slightly higher out-of-pocket costs on beneficiaries, are balanced with the extension of valuable services such as telehealth. This service extension becomes especially important in rural areas and for individuals with mobility or accessibility issues.

In addition, the CR sets the stage for increased funding for Medicare Improvement Funds starting in FY2026, which serves as a catalyst for future innovations in care delivery. By balancing immediate cost adjustments with long-term investment in program improvements, these provisions demonstrate an integrated approach to mitigating current fiscal pressures while planning for the evolving landscape of healthcare needs.

Medicaid: Ensuring Consistency in Vulnerable Communities

The ultimate goal of the Medicaid-related provisions is to secure the continuity of services for economically vulnerable populations. The CR specifically targets the elimination of cuts to Disproportionate Share Hospital funding, which many safety-net hospitals rely on to provide high-quality care to those who cannot afford private health services. By eliminating these cuts through September 30, 2025, the resolution protects hospitals from financial instability and promotes unimpeded access to essential healthcare services.

While future policy revisions and discussions may explore alternative approaches, such as implementing work requirements, the immediate focus remains on preserving and stabilizing current funding levels. This stabilization encourages healthcare providers to continue offering critical services without the concerns of sudden funding constraints, and it fosters a climate of trust and reliability among both providers and beneficiaries.