As the Washington Post helpfully points out, the origin of the $716 billion number the Republicans are throwing around is from a letter the nonpartisan Congressional Budget Office sent to John Boehner explaining how expensive it would be to repeal Obama’s health care law. Among the costs of repeal would be an additional $716 billion in Medicare spending over the next ten years.
The Post also supplies a helpful chart that demonstrates that the Medicare savings in ObamaCare come in three roughly-equal parts. About 35% of the savings comes from paying lower reimbursements to hospitals, which accepted this deal because they know they will have a lot more insured customers who will make up for any loss in profits. About 30% of the savings came from tightening up the private insurance known as Medicare Advantage.
The whole idea of Medicare Advantage was to drive down the cost of health insurance for the elderly as private insurance companies competing for seniors’ business.
That’s not what happened. By 2010, the average Medicare Advantage per-patient cost was 117 percent of regular fee-for-service. The Affordable Care Act gives those private plans a haircut and tethers reimbursement levels to the quality of care administered, and patient satisfaction.
And the remaining 35% of savings comes from an assortment of changes, including less compensatory money for hospitals who treat a high level of the uninsured (because there will be a lot fewer uninsured people soon).
In other words, the Affordable Care and Patient Protection Act made Medicare a lot more efficient, but it didn’t do anything to reduce anyone’s Medicare benefits.
So, does it make sense to say that Obama cut Medicare by $716 billion?
But, it gets worse.
When Paul Ryan put his budget proposal together, he didn’t want to have to find another $716 billion in the budget, so he left all those cost savings from ObamaCare in place. And then all but four Republicans voted for those cost savings. But now they want to call those cost savings “cuts” and pretend that they didn’t vote for them. And they want to use these “cuts” that they claim only the Democrats are responsible for as a kind of magic shield to protect them from the charge that they want to take a huge bite out of people’s Medicare benefits.
As I explained in a piece last night and a piece this morning, the Republicans thought they could pass this lie off as the truth until Paul Ryan was placed on the ticket with Mitt Romney. Now they are not so sure. To see that they have a problem, all you have to do is look at how Romney surrogate John Sununu was treated this morning on CNN when he tried to peddle this nonsense.
After CNN host Soledad O’Brien pointed out that Romney is on the record as supporting the Ryan Budget at the time it was debated, and then showed Sununu some information from Romney’s website that demonstrated that his Medicare plan was substantially the same as Ryan’s, Sununu exploded:
“Put an Obama bumper sticker on your forehead when you do this,” he yelled, and charged the president with “taking $717 billion” out of Medicare via the Affordable Care Act, a statistic O’Brien said had been debunked.
“They are assuming, Soledad, stop this!” “All you’re doing is mimicking the stuff that comes out of the White House and gets repeated on the Democratic blog boards out there. If you’re going to mouth what comes out of the White House. …”
Then it was O’Brien’s turn to interrupt, saying that her questioning of Sununu’s assertion was rooted in “independent analysis.”
“Sir, let me finish. Let me finish,” she said. “There’s independent analysis, [Factcheck.org], the CBO, and CNN has also done its own independent analysis and name-calling to me and somehow acting as if by repeating a number of $716 billion, that you can make that stick. … That’s not true. You can’t just repeat it and make it true, sir.”
[the transcript/paraphrasing above is taken with a few edits from Olympia at Daily Kos].
The whole $716 billion or $717 billion argument has been debunked in the sense that saving us hundreds of billions of dollars is in no way similar to destroying the guaranteed benefit of Medicare to line the pockets of filthy rich people like Mitt Romney.
