ObamaCare does not reduce anyone’s Medicare benefits, and it’s dishonest to say it does


A great blogger who calls himself BooMan NAILS IT:

[T]he 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.

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 cutMedicare 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.

And then there’s THIS:

The Romney campaign is still working out the kinks in its messaging on Medicare in the days since Rep. Paul Ryan joined the Republican ticket.

The Romney campaign is charging that President Obama has cut $700 billion from Medicare. It has been less vocal about the fact that the Ryan plan, too, takes $700 billion from Medicare.

But one Romney surrogate admitted Tuesday morning that Ryan’s plan does make those same cuts.

John Sununu, the former governor of New Hampshire, said the $700 billion in cuts is one of the big differences between the Romney and Ryan plans.

Romney’s plan is “very different,” Sununu said. “When Obama gutted Medicare by taking $717 billion out of it, the Romney plan does not do that,” Sununu said on CNN’s “Starting Point” Tuesday. “The Ryan plan mimicked part of the Obama package there. The Romney plan does not. That’s a big difference.”

The distinction embodies the tough road ahead for Romney: Romney has said he would have signed the Ryan budget, which would have contained the same cuts over which he is currently attacking Obama.

UPDATE: There’s more about this stuff in this nifty video:




  1. You can’t magically cut 700 billion dollars and not have it impact patient care.

    The impact will come via decreased access for patients to physicians, decreased services for patients, decreased access to new treatments and fewer health care facilities, likely in the areas most in need of the service.

  2. Well, doc, of it is the cuts and not where the cut are made that hurts Medicare, thenRyan’s plan is no better than Obama’s plan, and the way to save Medicare is to make no cuts.

  3. Neftali

    “About 30% of the savings came from tightening up the private insurance known as Medicare Advantage.”

    That sure sounds like Medicare benefit reduction to me.

  4. Medicare Advantage offers the same Medicare benefits. Some plans offer additional benefits as well outside of medicare and usually at an additional cost. The people with Medicare Advantage will still get all the Medicare benefits. If they want additional benefits they can still get them. Medicare is just not going to pay an additional 15% or so for private insurance companies to administer Medicare benefits. The lesson form Medicare Advantage is that the government can provide the same Medicare benefits at a lower cost than private insurance companies.

  5. This self proclaimed “great blogger” has done a huge disservice to his own democratic party. Had he actually done his RESEARCH and not just went half cocked on Ryans plan (because Obamas is so great you know)

    The majority of the cuts, come from reductions in how much Medicare reimburses hospitals and private health insurance companies

    34.8 % comes from Hospital reimbursement rates

    30.2% represents reductions in how much Medicare reimburses private, Medicare Advantage plans. That program allows seniors to join a private health insurance, with the federal government footing the bill. 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.

    The Medicare Advantage cut gets the most attention, but it only accounts for about a third of the Affordable Care Act’s spending reduction. Another big chunk comes from the hospitals. The health law changed how Medicare calculates what they get reimbursed for various services, slightly lowering their rates over time. Hospitals agreed to these cuts because they knew, at the same time, they would likely see an influx of paying patients with the Affordable Care Act’s insurance expansion.

    The rest of the Affordable Care Act’s Medicare cuts are a lot smaller. Reductions to Medicare’s Disproportionate Share Payments — extra funds doled out the hospitals that see more uninsured patients — account for 5 percent in savings. Lower payments to home health providers make up another 8.8 percent About a dozen cuts of this magnitude make up the balance…..

    SO …ROMNEY ended up being CORRECT…OBAMA…cuts 716 BILLION from Medicare…

    SO Thanks…Really for such a great “BLOG” on something you OBVIOUSLY know nothing about…..

  6. Concerned Patient

    Cuts are Cuts. This blog article by ” BooMan” is misleading. He sounds like he is spewing Obama White House talking points and their “controlled messaging” or more accurately their “contrived” messaging. At the time ObamaCare was debated, the CBO clearly noted that these Medicare cuts would be done to help pay for ObamaCAre, NOT to help make Medicare more solvent. The Obama scheme double counted the savings. CUTS to MEdicare Advantage will hurt coverage for thousands of Seniors. CUTS to providers will hurt access to thousands of Seniors which will hurt patient care. It is well established that reimbursement rates are already so low that many clinics are closing thier doors. It is inaccurate to say Ryan’s plan keeps these cuts. Read the REVISED Ryan’s plan. You are referring to the old plan that many other liberal bloggers are harping on as well. Lets wait and see what the Romney plan has before we make a judgement. Romney is the candidate. He will have his own plan. One good thing about this discussion ??? It re-ignites our discussion about the atrocities of ObamaCAre ….the IABP panel, the massive cuts, and the oppressive regulations.

  7. My elderly Mother-in-law just lost her doctor. The reason he gave was the reduction in reimbursements due to the AFCA.

  8. Wilson: reimbursements from what entity? Private insurance? Medicare? Medicaid? If it’s private insurance, talk to the insurance companies, which are rolling in money. If it’s Medicare, reimbursements from that program have been low for years, not just since the AFCA was signed into law. Medicare extracts huge discounts from providers based on volume and they haven’t increased their reimbursements in years. Need to lobby Congress on that one; it’s not the fault of the AFCA. And, if Ryan gets his way, your elderly MIL’s Medicare would be replaced by a voucher program and she’d be out on her own trying to get her own coverage. I see what working out really well for lots of seniors.

  9. BOTH Medicare and private insurers have been decreasing reimbursements for years. However, the primary fault is indeed with Medicare and there is only going to be more to come.

    Most physicians contracts with insurance companies are based on a percentage of Medicare fee schedule, say 140% of Medicare fees. If the Medicare rates go down (which they have been, and will continue to do) all of a physicians payments drop, but drop the most for Medicare and Medicaid.

    Many physician practices have reached the point that the volume no longer makes up for the lost revenue and they are either becoming employed by health systems (who then accept the loss in exchange for the other revenue) or are closing their doors. This is particularly true in areas where the need is greatest (rural and inner city).

    As I have stated numerous times, if you like your physician hold on tight and pray they don’t close their offices.

  10. This piece is so full of lies and obfuscations it’s almost not worth responding to, almost because when something is this dishonest it must be responded to.

    You can try to twist and contort the numbers all you want but he is one fact that is not up for debate. nearly three weeks about my wife, I’m 50 and she’s slightly older, received a letter from our doctors practice, the practice we’ve been with for the last 25 years, that the partners in the practice have decide they will no longer be accepting new Medicare patients after the first of the year the coming year due to the changes being implemented by Obamacare.

    This was warned about by critics before the legislation was passed and it is being repeated by doctors all over the county in increasing numbers as they refuse to subsidize Medicare out of their own pockets.

    Let’s say for the sake of argument we accept the tortured reasoning used by the author, what does it matter what the numbers are if when it’s time for us to retire (ha like that’s going to happen after the destruction wrought on the economy by this administration) if we have the same level of “coverage” if our doctors won’t accept it or keep us as patients and few if any ever will?

    And this is even BEFORE the IPABs are set up in 2014 and they begin reducing access to treatments, tests, procedures and drugs using cost/benefit analysis which includes AGE considerations … how is not a cut in benefits if care that is available to a Medicare patient today regardless of their age won’t be available to a patient in the same circumstance five years from now?

    All other issues aside, anyone who could argue that having coverage that won’t be accepted by most private doctors and medical practices and reduces access to care options once fully implemented is not a cut in benefits is so intellectually, not mention morally, bankrupt as to be beyond hope of reasoning with.

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