“We took half a trillion dollars out of Medicare in the Affordable Care Act, the health care bill, already.”
—Minority Leader Nancy Pelosi (D-CA),CNBC interview, October 2011
Contrary to his rhetoric, President Obama’s federal takeover of healthcare law devastates Medicare to pay for new entitlement spending. The cuts to Medicare payment rates and the establishment of a 15-member board of unelected bureaucrats (IPAB) to implement price controls will hasten the insolvency of the program, hurting current beneficiaries and breaking Medicare’s promise to future generations. The American people know who really “voted to end Medicare."
Debunking the president’s claims
The following comments were made by President Obama at a campaign event on August 15, 2012, in Dubuque, Iowa:
President’s claim: “[The Republican plan] means seniors would not have the guarantee of Medicare and because the voucher would not keep up with costs, the [House budget plan] would force seniors to pay an extra $6,400 per year.”
Reality: The president’s rhetoric conveniently ignores the full consequences for seniors of the deteriorating access and quality that that his own health care law ensures. Further, the math he uses failed to include the extra $7,800 our plan provided to lower-income seniors to ensure that no senior is denied access to quality, affordable health coverage.
Moreover, the FY2013 House budget improved upon last year’s budget, using a competitive-bidding process to determine the growth in premium support payments. Under competitive bidding, participating plans compete to deliver the same package of guaranteed benefits as traditional Medicare at a lower cost, and Medicare’s payment to seniors is set at the second-lowest bid or traditional fee-for-service, whichever is cheaper. The FY2013 Path to Prosperity budget also added an option for seniors to choose traditional Medicare and enjoy the same level of benefits as seniors today.
President’s claim: “I made reforms that saved millions of seniors hundreds of dollars on their prescription drugs.”
Reality: The Congressional Budget Office (CBO) has confirmed that the federal takeover of healthcare law’s new requirements will drive up health-care costs, at odds with claims made by its proponents. In a letter to the Budget Committee Ranking Member in 2010, CBO stated that “[The] increase in prices would make federal costs for Medicare’s drug benefit and the costs faced by some beneficiaries higher than they would be in the absence of those provisions,” and that “the premiums of drug plans will increase along with the increase in net drug prices, so the premiums paid by beneficiaries will increase slightly.” Like the rest of this costly new entitlement, provisions that increase prescription-drug prices should be repealed.
President’s claim: “I proposed reforms by getting rid of wasteful spending in the health care system, reforms that will not touch your Medicare benefits, not by a dime.”
Reality: The President’s partisan healthcare law creates an unaccountable board of 15 unelected bureaucrats – the Independent Payment Advisory Board (IPAB) – empowered to cut Medicare in ways that will result in denied care and restricted access for seniors. The bureaucrat-imposed cuts threaten critical care for current seniors and fail to strengthen Medicare for future generations. Moreover, his most recent budget includes a proposal to further empower IPAB by giving its 15 bureaucrats “the ability to consider value-based benefit design.” In addition, he raids the Medicare program by over $700 billion to pay for his health care law’s new open-ended entitlement. This raid comes in the form of cuts to providers that Medicare’s chief actuary has termed “unsustainable” and would cause “about 15 percent of hospitals, skilled nursing facilities, and home health agencies” to become unprofitable, which could harm seniors’ access to providers and lead to the denial of critical care.
President’s claim: “My plan already extended Medicare by nearly a decade.”
Reality: Such a claim relies on the President’s infamous double-counting of Medicare savings. Medicare’s chief actuary has written that the Medicare provisions in the law “cannot be simultaneously used to finance other Federal outlays (such as the coverage expansions under the federal takeover of healthcare law) and to extend the [Medicare] trust fund, despite the appearance of this result from the respective accounting conventions.” Since the President raids Medicare to pay for his health care law, he cannot also claim to extend Medicare’s solvency.
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