Medicare for Dummies

The thing about the bully pulpit is that Presidents can make the most fantastic claims and it takes days to sort the reality from the myths. So as a public service, let's try to navigate the, er, remarkable Medicare discussion that President Obama delivered on Wednesday. It isn't easy.

Mr. Obama began by depicting a crisis in the entitlement state, noting that "our health-care system is placing an unsustainable burden on taxpayers," especially Medicare. Unless we find a way to cauterize this fiscal hemorrhage, "we will eventually be spending more on Medicare than every other government program combined. Put simply, our health-care program is our deficit problem. Nothing else even comes close."

On this score he's right. Medicare's unfunded liability—the gap between revenues and promised benefits—is currently some $37 trillion over the next 75 years. Yet the President uses this insolvency as an argument to justify the creation of another health-care entitlement, this time for most everyone under age 65. It's like a variation on the old Marx Brothers routine: "The soup is terrible and the portions are too small."

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Medicare
Associated Press

President Barack Obama addresses a joint session of Congress on Wednesday, Sept. 9, 2009.
Medicare
Medicare

As astonishing, Mr. Obama claimed he can finance universal health care without adding "one dime to the deficit, now or in the future, period," in large part by pumping money out of Medicare. The $880 billion Senate plan he all but blessed this week would cut Medicare by as much as $500 billion, mainly by cutting what Mr. Obama called "waste and abuse." Perhaps this is related to the "waste and abuse" that Congresses of both parties have targeted dozens of times without ever cutting it.

Apparently this time Mr. Obama means it, though he said this doesn't mean seniors should listen to "demagoguery and distortion" about Medicare cuts. That's because Medicare is a "sacred trust," and the President swore to "ensure that you—America's seniors—get the benefits you've been promised."

So no cuts, for anyone—except, that is, for the 24% of senior beneficiaries who are enrolled in the Medicare Advantage program, which Democrats want to slash by $177 billion or more because it is run by private companies. Mr. Obama called that money "unwarranted subsidies in Medicare that go to insurance companies—subsidies that do everything to pad their profits but don't improve the care of seniors."

In fact, Advantage does provide better care, which is one reason that enrollment has doubled since 2003. It's true that the program could be better designed, with more competitive bidding and quality bonuses. But Advantage's private insurers today provide the kind of care that Mr. Obama said he would mandate that private insurers provide for the nonelderly—"to cover, with no extra charge, routine checkups and preventative care."

Advantage plans have excelled at filling in the gaps of the a la carte medicine of traditional Medicare, contracting with doctors and hospitals to coordinate care and improve quality and covering items such as vision, hearing and management of chronic illness. If seniors in Advantage lose this coverage because of the 14% or 15% budget cut that Mr. Obama favors, well, that's "waste and abuse."

Mr. Obama did also promise to create "an independent commission of doctors and medical experts charged with identifying more waste in the years ahead." That kind of board is precisely what has many of the elderly worried about government rationing of treatment: As ever-more health costs are financed by taxpayers, something will eventually have to give on care the way it has in every other state-run system.

But Mr. Obama told seniors not to pay attention to "those scary stories about how your benefits will be cut, especially since some of the folks who are spreading these tall tales have fought against Medicare in the past and just this year supported a budget that would essentially have turned Medicare into a privatized voucher program."

This is a partisan swipe at one of the best GOP ideas to rationalize the federal budget, despite Mr. Obama's accusations that his opponents want to do "nothing." This reform would get Medicare out of the business of spending one out of five U.S. health dollars, and instead give the money directly to seniors to buy insurance to encourage them to be more conscious of cost and value within a limited budget. Democrats would rather have seniors dance to decisions made by his unelected "commission of doctors and medical experts."

Mr. Obama also called for "civility" in debate even as he calls the arguments of his critics "lies." So in the spirit of civility, we won't accuse the President of lying about Medicare. We'll just say his claims bear little relation to anything true.

FACT CHECK: Obama uses iffy math on deficit pledge

By CALVIN WOODWARD and ERICA WERNER
Associated Press Writers

AP Photo/Jason Reed

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WASHINGTON (AP) -- President Barack Obama used only-in-Washington accounting Wednesday when he promised to overhaul the nation's health care system without adding "one dime" to the deficit. By conventional arithmetic, Democratic plans would drive up the deficit by billions of dollars.

The president's speech to Congress contained a variety of oversimplifications and omissions in laying out what he wants to do about health insurance.

A look at some of Obama's claims and how they square with the facts or the fuller story:

OBAMA: "I will not sign a plan that adds one dime to our deficits either now or in the future. Period."

THE FACTS: Though there's no final plan yet, the White House and congressional Democrats already have shown they're ready to skirt the no-new-deficits pledge.

House Democrats offered a bill that the Congressional Budget Office said would add $220 billion to the deficit over 10 years. But Democrats and Obama administration officials claimed the bill actually was deficit-neutral. They said they simply didn't have to count $245 billion of it - the cost of adjusting Medicare reimbursement rates so physicians don't face big annual pay cuts.

Their reasoning was that they already had decided to exempt this "doc fix" from congressional rules that require new programs to be paid for. In other words, it doesn't have to be paid for because they decided it doesn't have to be paid for.

The administration also said that since Obama already had included the doctor payment in his 10-year budget proposal, it didn't have to be counted again.

That aside, the long-term prognosis for costs of the health care legislation has not been good.

CBO Director Douglas Elmendorf had this to say in July: "We do not see the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount."

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OBAMA: "Nothing in this plan will require you or your employer to change the coverage or the doctor you have."

THE FACTS: That's correct, as far as it goes. But neither can the plan guarantee that people can keep their current coverage. Employers sponsor coverage for most families, and they'd be free to change their health plans in ways that workers may not like, or drop insurance altogether. The Congressional Budget Office analyzed the health care bill written by House Democrats and said that by 2016 some 3 million people who now have employer-based care would lose it because their employers would decide to stop offering it.

In the past Obama repeatedly said, "If you like your health care plan, you'll be able to keep your health care plan, period." Now he's stopping short of that unconditional guarantee by saying nothing in the plan "requires" any change.

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OBAMA: "The reforms I'm proposing would not apply to those who are here illegally." One congressman, South Carolina Republican Joe Wilson, shouted "You lie!" from his seat in the House chamber when Obama made this assertion. Wilson later apologized.

THE FACTS: The facts back up Obama. The House version of the health care bill explicitly prohibits spending any federal money to help illegal immigrants get health care coverage. Illegal immigrants could buy private health insurance, as many do now, but wouldn't get tax subsidies to help them. Still, Republicans say there are not sufficient citizenship verification requirements to ensure illegal immigrants are excluded from benefits they are not due.

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OBAMA: "Don't pay attention to those scary stories about how your benefits will be cut. ... That will never happen on my watch. I will protect Medicare."

THE FACTS: Obama and congressional Democrats want to pay for their health care plans in part by reducing Medicare payments to providers by more than $500 billion over 10 years. The cuts would largely hit hospitals and Medicare Advantage, the part of the Medicare program operated through private insurance companies.

Although wasteful spending in Medicare is widely acknowledged, many experts believe some seniors almost certainly would see reduced benefits from the cuts. That's particularly true for the 25 percent of Medicare users covered through Medicare Advantage.

Supporters contend that providers could absorb the cuts by improving how they operate and wouldn't have to reduce benefits or pass along costs. But there's certainly no guarantee they wouldn't.

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OBAMA: Requiring insurance companies to cover preventive care like mammograms and colonoscopies "makes sense, it saves money, and it saves lives."

THE FACTS: Studies have shown that much preventive care - particularly tests like the ones Obama mentions - actually costs money instead of saving it. That's because detecting acute diseases like breast cancer in their early stages involves testing many people who would never end up developing the disease. The costs of a large number of tests, even if they're relatively cheap, will outweigh the costs of caring for the minority of people who would have ended up getting sick without the testing.

The Congressional Budget Office wrote in August: "The evidence suggests that for most preventive services, expanded utilization leads to higher, not lower, medical spending overall."

That doesn't mean preventive care doesn't make sense or save lives. It just doesn't save money.

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OBAMA: "If you lose your job or change your job, you will be able to get coverage. If you strike out on your own and start a small business, you will be able to get coverage."

THE FACTS: It's not just a matter of being able to get coverage. Most people would have to get coverage under the law, if his plan is adopted.

In his speech, Obama endorsed mandatory coverage for individuals, an approach he did not embrace as a candidate.

He proposed during the campaign - as he does now - that larger businesses be required to offer insurance to workers or else pay into a fund. But he rejected the idea of requiring individuals to obtain insurance. He said people would get insurance without being forced to do so by the law, if coverage were made affordable. And he repeatedly criticized his Democratic primary rival, Hillary Rodham Clinton, for proposing to mandate coverage.

"To force people to get health insurance, you've got to have a very harsh penalty," he said in a February 2008 debate.

Now, he says, "individuals will be required to carry basic health insurance - just as most states require you to carry auto insurance."

He proposes a hardship waiver, exempting from the requirement those who cannot afford coverage despite increased federal aid.

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OBAMA: "There are now more than 30 million American citizens who cannot get coverage."

THE FACTS: Obama time and again has referred to the number of uninsured as 46 million, a figure based on year-old Census data. The new number is based on an analysis by the Kaiser Commission on Medicaid and the Uninsured, which concluded that about two-thirds of Americans without insurance are poor or near poor. "These individuals are less likely to be offered employer-sponsored coverage or to be able to afford to purchase their own coverage," the report said. By using the new figure, Obama avoids criticism that he is including individuals, particularly healthy young people, who choose not to obtain health insurance.

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Associated Press writer Jim Kuhnhenn contributed to this report.

ObamaCare: The Problem is Substance

ObamaCare: The Problem is the Substance

By Jonah Goldberg

ABC News reports that Barack Obama has returned to Washington, only to step off the plane and "into his next domestic crisis." He "planned to leave the details of health-care reform to Congress, but today the White House says he'll play a much stronger role." The Associated Press says Obama is "backing away" from his "‘it's-all-on-the-table' approach" and is "prepared to get louder and more involved in the details of a health care overhaul." "This weekend," NBC Nightly News explained in its lead story, "the president signaled an aggressive stance to put his personal stamp on the sweeping legislation."
There's only one problem. These stories were all reported nearly three months ago.

Why the Obama administration is determined to do the time warp again is easy to decipher. Obama's advisers think the answer to every problem is more cowbell, if by "cowbell" you mean "Obama." It's like Obama guru David Axelrod is the Christopher Walken character from the Saturday Night Live skit about Blue Oyster Cult (if you don't know the reference, Google "cowbell").
Every time someone comes up with an alternative to throwing Obama on TV, Axelrod says, "No, no, no. Guess what? I got a fever, and the only prescription . . . is more Obama!"
But is that really what the doctor ordered?
Obama's address next week will be his third prime-time appeal in three months and the fifth in his seven-month-old presidency. The networks are chagrined about this, not least because the ratings half-life of these events is severe. (Fox's broadcast network beat out the other networks by running So You Think You Can Dance instead of his last prime-time press conference.) More relevant, they haven't done Obama much good.
His July 22 press conference was billed as perhaps Obama's last chance to save health-care reform. It tanked (partly because Obama's attack on the Cambridge police dominated the press). Afterward, public support for Obamacare dropped significantly. A Pew poll taken that week found that more people opposed the proposals being considered by Congress than supported them, and that Obama's overall approval had dropped 7 points from the previous month. Other polls showed similar declines.
Now, more than a month later, things look even worse. The obvious solution? Even more cowbell.
But what is lacking is not cowbell, it's substance the American people can support. Obama will reportedly be "more specific," but he won't commit himself to any particular piece of legislation. This suggests that the White House still thinks it has a communication problem, and if only it dispels the cloud of "lies" belched up by the opposition, there will be nothing but blue skies ahead.
Funny how the people who run the most sophisticated communication operation in the history of the presidency keep concluding that their difficulties stem from their inability to get their message out and never from what their message actually is.
And so, rather than change the substance of the message, they're grabbing an even bigger megaphone: an address to a joint session of Congress. Three out of the last four presidents gave just one address to a joint session of Congress, and all but one of them reserved such occasions for major international events, like a war or, in Ronald Reagan's case, a breakthrough with Soviet leader Mikhail Gorbachev. Only Bill Clinton used such a venue for a domestic priority: health-care reform.
That didn't work out so well either.
Just seven months into Obama's presidency, the White House is turning up the faders on the cowbell as loud as they will go. And, heck, if you love cowbell, it's going to be a real treat. But in all the ways that matter, it may just end up being more noise.