Monday, August 27, 2012

President Obama’s Twofold Dishonesty on Cutting Medicare Benefits

Amidst the debate on the campaign trail, there’s been a lot of heated rhetoric of late about Medicare “benefits” and who’s doing what (or not) to them.  For instance, in a recent speech the President said that “I’ve proposed reforms that will save Medicare money by getting rid of wasteful spending in the health care system.  Reforms that will not touch your Medicare benefits.”

There’s only one problem: That statement is flat-out FALSE.  The President HAS enacted cuts to Medicare benefits – namely, additional means-testing in Obamacare – and proposed even more Medicare benefit cuts.  For instance, in his budget submitted to Congress this spring, the President proposed:

  • Increasing means-tested premiums under Parts B and D by 15%, and freezing the income thresholds at which means testing applies until 25 percent of beneficiaries are subject to such premiums;
  • Increasing the Medicare Part B deductible by $25 in 2017, 2019, and 2021;
  • Introducing a home health co-payment of $100 per episode in cases where an episode lasts five or more visits and is NOT proceeded by a hospital stay; and
  • Imposing a Part B premium surcharge equal to about 15 percent of the average Medigap premium – or about 30 percent of the Part B premium – for seniors with Medigap supplemental insurance that provides first dollar coverage.

The problem is not necessarily the policy proposals for these particular benefit cuts, which many may find meritorious.  The Medicare Payment Advisory Commission (MedPAC) has previously recommended introducing home health co-payments as a way to ensure appropriate utilization.  Congresses controlled by both Republicans and Democrats have enacted some (limited) means-testing in Medicare.  And Medigap reform has been an element of bipartisan proposals to extend Medicare’s solvency and make the program more efficient.

Instead, the fundamental problem is the President’s twofold dishonesty when it comes to cutting Medicare benefits.  First, in saying that he hasn’t proposed cutting Medicare benefits when he has.  Second, and just as importantly, in the way he has proposed cutting those benefits – all the benefit changes the President proposed in his budget would not take effect until 2017, after he leaves office.  Just like with the Cadillac tax – scheduled to take effect in 2018 – or the massive changes to Exchange insurance subsidies that will make health care less affordable after 2019, Barack Obama wants to give away all the government “goodies” while he’s in office – and stick the next President with the bill after he leaves.  That’s not leadership; that’s the antithesis of leadership.