New Romney Plan: Make Medicare Insolvent by 2016
Yesterday, we discussed the Romney campaign’s attempt to distract from the Romney-Ryan plan to end Medicare as we know it and replace it with a voucher system that will increase seniors’ health care costs by thousands of dollars. The Romney campaign was also under fire for attacking the $716 billion in Medicare savings found in Obamacare, despite the fact that Romney himself had repeatedly endorsed plans including those exact same savings and even promised just this week that he’d sign the Ryan plan that included them into law.
As we noted, Obamacare uses that money to expand benefits and strengthen Medicare by extending its solvency for an additional 8 years, while the Romney-Ryan plan would simply steal the $716 billion and use it to pay for new tax cuts for the wealthiest Americans and huge corporations.
Now Mitt Romney is arguing that he’ll put all of those savings back in to Medicare. ThinkProgress’ Igor Volsky explains how that will actually make the system less efficient and hasten Medicare’s demise:
“My commitment is, if I become President, I’m going to restore that $716 billion to the Medicare trust fund so that current seniors can know that the trust fund is not being raided and get Medicare on track to be solvent long-term on a permanent basis,” Romney told CBS on Wednesday morning. But in replenishing the funds, Romney would actually be making the program worse off, not better.
The Obamacare savings slow the growth of Medicare over the next decade by, in part: eliminating overpayments to private insurers in Medicare Advantage, reforming provider payments to encourage greater efficiency, tying reimbursements to improvements in economic productivity, and reducing fraud and abuse. The law does not impact patient benefits. CMS offers a partial breakdown:
As a result of these savings, “growth in spending will be restrained” and the life of the Medicare trust fund is expanded by eight years, the government estimates. Sixteen million seniors are also benefiting from the savings by receiving preventive benefits without deductibles or co-pays and saving more than $3.9 billion on prescription drugs.
Should Romney restore the $716 billion — and unless he institutes other yet to be specified reforms — we would move back to the old system of overpaying private insurers and providers. He’d be re-inserting inefficiency back into the system, jeopardizing the benefits that seniors are currently enjoying, and shrinking the solvency of the Medicare trust fund from 2024 under current law to 2016.
And you don’t have to just take our word for it. An independent Medicare expert told us that Romney’s do-over plan will “definitely” make Medicare insolvent in just four short years:
“All of the demonstration and pilot programs aimed at payment and delivery system reform would also be eliminated,” Steve Zuckerman of the Urban Institute told ThinkProgress. “Definitely, the 8 year extension in the life of the Medicare HI trust fund would be gone.”
He added, “If I could ask Romney-Ryan one question on this topic it would be: After you repeal the ACA and restore the cuts in Medicare payments, would you then reinstate the Medicare cuts as part of your own budget plan?”
BOTTOM LINE: In an attempt to get out from under one problem, Mitt Romney has only succeeded in making things worse by admitting that he’ll let the Medicare trust fund run dry in just four years. Any way you slice it, Mitt Romney and Paul Ryan plan to end Medicare as we know it and leave seniors with steeply increased health care costs.
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