Right-wing media figures are claiming that Rep. Paul Ryan's budget proposal does not cut Medicare spending, while accusing President Obama of having "cut" $500 billion from Medicare as part of the Affordable Care Act. In fact, these "cuts" come through eliminating parts of Medicare "seen as ineffective or wasteful," and Ryan's plan retains this $500 billion in reductions, while increasing out-of-pocket costs for seniors.
Right-Wing Media Figures Claim Obama Health Law "Cuts" Medicare Spending While Ryan Plan Does Not
Limbaugh: "Paul Ryan Doesn't Rape Medicare To The Tune Of $500 Billion. Your Guy Did." From the May 26 edition of The Rush Limbaugh Show:
LIMBAUGH: Who is it that, in his own health care bill, took $500 billion out of Medicare in order to get his total price tag in under a trillion dollars? It was your guy, it was Barack Obama. It's there, $500 billion gone. Ryan didn't do that. Paul Ryan doesn't rape Medicare to the tune of $500 billion. Your guy did. [Premiere Radio Networks, The Rush Limbaugh Show, 5/26/11]
Bozell Denies There Are Medicare Cuts In Ryan Plan, Then Says, "Obama Is Taking $500 Billion Out Of Medicare." From the May 27 edition of Fox & Friends:
BRENT BOZELL (Media Research Center president): Both NBC and ABC reported cuts. And you heard the ABC reporter, Ann Curry, say "deep cuts." Folks, here are the numbers. You tell me if they're deep cuts. The present allocation for Medicare, $563 billion. What Paul Ryan proposes by 2021 is $953 billion. Folks, that's a 70 percent increase in Medicare. And ABC and NBC reported that as deep cuts. Folks, that's dishonest, There is no other way of putting this. That's lying on national television. And that's setting up seniors. That's a scare tactic, and maybe it worked.
CLAYTON MORRIS (guest co-host): Well, are Democrats picking up on some of the talking points here, Brent, because The Wall Street Journal on April 4th reported that the Ryan plan would effectively end Medicare. And then all these Democrats jumped on that and said, "Hey, The Wall Street Journal said it's gonna end Medicare as we know it," and then you started to hear it trickle into the mainstream media.
BOZELL: Sure. Well, why don't they look at Obama's health care budget? Obama is taking $500 billion out of Medicare. So, if you're worried about Medicare cuts, why don't you look at Obamacare, which takes it away? [Fox News, Fox & Friends, 5/27/11]
In Fact, Savings Come From Reducing Inefficiency; Experts Predict Quality Of Care Under Medicare Will Not Decline
FactCheck: Cost-Saving Provisions Are "Not A Slashing Of The Current Medicare Budget Or Benefits." According to FactCheck.org:
Whatever you want to call them, it's a $500 billion reduction in the growth of future spending over 10 years, not a slashing of the current Medicare budget or benefits. It's true that those who get their coverage through Medicare Advantage's private plans (about 22 percent of Medicare enrollees) would see fewer add-on benefits; the bill aims to reduce the heftier payments made by the government to Medicare Advantage plans, compared with regular fee-for-service Medicare. The Democrats' bill also boosts certain benefits: It makes preventive care free and closes the "doughnut hole," a current gap in prescription drug coverage for seniors. [FactCheck.org, 3/19/10]
PolitiFact: Reductions "Aimed At Eliminating Parts Of The Medicare Program Seen As Ineffective Or Wasteful." From PolitiFact.com:
Under the act, Congress voted to reduce $500 billion in projected Medicare spending over the next 10 years, not in one substantial chunk. The reductions are aimed at eliminating parts of the Medicare program seen as ineffective or wasteful. For example, the plan phases out payments to the Medicare Advantage program, an optional program set up under the George W. Bush administration, where seniors could opt to enroll in a private insurance program and the federal government would subsidize a portion of their premium. [PolitiFact.com, 5/10/11]
PolitiFact: CBO Says "Spending For Medicare Will Continue To Increase Over The Next Decade." From PolitiFact.com:
On the surface, it may seem that lawmakers voted to cut Medicare spending under the new health law, but they instead cut the rate of growth. As a report by the nonpartisan Congressional Budget Office notes, the amount of spending for Medicare will continue to increase over the next decade, from $499 billion in 2009 to $929 billion in 2020. [PolitiFact.com, 5/10/11]
PolitiFact: "Experts Say The Quality Of Care Should Not Be Shortchanged." From PolitiFact:
[E]ven though $500 billion in spending is being reduced, health care experts say the quality of care should not be shortchanged.
"Some (reforms) increase Medicare spending to improve benefits and coverage," said Tricia Neuman, vice president and director of the Medicare Policy Project at the nonpartisan Kaiser Family Foundation, in a video on the foundation's website.
"Other provisions reduce the growth in Medicare spending to help the program operate more efficiently and help fund coverage expansions to the uninsured in the underlying health reform legislation," Neuman said. "Other provisions are designed to improve the delivery of care and quality of care." [PolitiFact.com, 5/10/11]
New England Journal Of Medicine: Affordable Care Act Eliminates "Substantial Overpayments" To Medicare Advantage Plans. From an article by Robert A. Berenson in The New England Journal of Medicine:
[T]he currently projected savings come from two main sources: reduced payments to private Medicare Advantage plans and reduced payment updates for hospitals and most other providers. A phased elimination of the substantial overpayments to Medicare Advantage plans, which now enroll nearly 25% of Medicare beneficiaries, will produce an estimated $132 billion in savings over 10 years.
The Medicare Payment Advisory Commission (MedPAC) has been calling for such fee reductions for years, to keep Medicare Advantage from undermining traditional Medicare.
The ACA also produces nearly $200 billion in savings by assuming that providers can improve their productivity as firms in other industries have done. On the basis of this presumed improvement, the law reduces Medicare's annual "market basket" updates for most types of providers -- a provision that has generated controversy. [The New England Journal of Medicine, 7/8/10]
FactCheck: Changes To Medicare Advantage Come With Extra Benefits For All Medicare Enrollees. According to FactCheck.org:
The CBO has estimated that the move would change the value of the extra benefits Medicare Advantage participants get, but they would not receive fewer benefits than the rest of seniors who aren't on the Advantage plans. The bill does add some extras for Medicare beneficiaries, eliminating copays and deductibles for preventive services, for example. [FactCheck.org, 12/2/09]
Ryan Plan Retains $500 Billion Of Savings From Obama Health Law
PolitiFact: "Ryan's Plan ... Intends To Keep The $500 Billion In Reductions." From PolitiFact.com:
Ryan's plan, as noted in this news article from the Associated Press, also intends to keep the $500 billion in reductions that Republicans have criticized Democrats for approving under the Obama plan.
The vote taken by Congress was not to cut Medicare but to reduce the rate of growth by $500 billion by targeting inefficiencies in the program. That's a cost-reduction plan that Ryan himself kept intact in his own budget proposal. [PolitiFact.com, 5/10/11]
Ryan Plan Privatizes Medicare
LA Times: "Under Ryan's Proposal, Seniors And Others On Medicare Would Begin Receiving A Set Amount Of Money ... To Offset The Cost Of Buying A Private Insurance Plan." The Los Angeles Times reports:
Under Ryan's proposal, seniors and others on Medicare would begin receiving a set amount of money, starting in 2022, to offset the cost of buying a private insurance plan that would replace the federal government's Medicare plan.
Wealthier and healthier seniors would receive less, while poorer and sicker beneficiaries would get more.
This voucher system -- or "premium support," as Ryan calls it -- would give the typical 65-year-old American $8,000 annually to buy a health plan, about the same amount of money that analysts expect the Medicare program would spend on that senior in 2022 under the current program. [The Los Angeles Times, 4/7/11]
CBO: Ryan Plan Would Increase Seniors' Out-Of-Pocket Health Care Costs
AP: "CBO: Big Health Cost Shift To Elderly In GOP Plan." From an April 6 Associated Press article, headlined "CBO: Big Health Cost Shift To Elderly In GOP Plan":
Most future retirees would pay considerably more for health care under the new budget proposed by House Republicans, according to an analysis by nonpartisan experts for Congress that signals problems ahead for the plan.
The fiscal blueprint would put people now 54 and younger in a different kind of health care program when they retire, unlike the Medicare that their parents and grandparents have known. Instead of coverage for a set of benefits prescribed from Washington, they'd get a federal payment to buy private insurance from a choice of government-regulated plans.
"A typical beneficiary would spend more for health care under the proposal," the nonpartisan Congressional Budget Office estimated in an analysis released late Tuesday.
The CBO said over time future retirees would pay much more, partly because the Medicare benefits package would be more expensive to deliver through private insurers. By 2030, the government payment would cover only about one-third of the typical retiree's total health care costs, the budget office said.
The sweeping fiscal plan by House Budget Chairman Paul Ryan, R-Wis., would reduce total federal spending, deficits and debt, saving money for federal taxpayers. But it would be tempered by a cost shift to future retirees. [Associated Press, 4/6/11]
CBPP: CBO Found That Typical Medicare Beneficiary's "Annual Out-Of-Pocket Costs Would More Than Double." From the CBPP report:
Since the Ryan proposal would reduce the federal government's contribution for beneficiaries' health care costs even as it caused total costs to increase, beneficiaries' out-of-pocket spending would rise dramatically.
CBO also finds that this beneficiary's annual out-of-pocket costs would more than double -- from $6,150 to $12,500. In later years, as the value of the voucher eroded, the increase in out-of-pocket costs would be even greater.
The report included this graph showing the projected increase in seniors' health care costs under Ryan's plan:
[CBPP, 4/7/11, emphasis in the original]