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Does Obamacare ‘Cut’ $716 Billion From Medicare?

I mentioned before last night’s debate that Mitt Romney’s critique of President Obama’s health-care reforms might focus on the number $716 billion. I was unexpectedly prescient: By my count, based on a transcript, Romney cited the number 10 times, including twice in his closing statement. (“If the president were to be re-elected, you’re going to see a $716 billion cut to Medicare.”) The president never specifically rebutted this claim (then again, he didn’t rebut much of anything in what seemed like a fairly flat performance.) But is the Republican candidate using the statistic accurately?

Romney’s number comes from a Congressional Budget Office report about the impact of the Affordable Care Act on Medicare. During the campaign, the GOP has represented the figure as cuts in benefits to seniors; the president’s camp, and various independent commentators, say the number represents cost reductions stemming from reforms in the way doctors and hospitals are paid. The fact-checkers’ verdict?, the Pulitzer-winning organ of the Tampa Bay Times, called it a “half-truth”; other major daily papers, including The New York Times and the Chicago Tribune, judged Romney’s use of the number to be somewhat misleading. (Interestingly enough, as of this writing the Trib’s article about the statistic appeared beneath a relatively large banner ad for the Obama campaign; earlier today, it was under a Romney banner.)

The Washington Examiner offers an interesting counterpoint, arguing that the reduction in money paid to insurers and hospitals “will inevitably result in less coverage and higher premiums for current recipients.” There’s some merit to that argument, though I’m not sure the outcome is inevitable. But that didn’t appear to be the point that Romney was trying to make last night.


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    • I have not checked in here for a while as I thought it was getting boring, but the last several posts are great quality so I guess I will add you back to my everyday bloglist. You deserve it my friend :)

    • Hello AnnaSaenz, what Obama is not telling you is that obamacare will be restricted plan and not for you to go as you please.
      Furthermore, if your illness is diagnosed as incurable, you will not get any more treatments and will be left to die.

      Obama is the biggest liar that America ever had as president.
      Your vote is insignificant to save obamacare, it will be dismantled by the congress next year, whether you like it or not, because it will cost to much money to run it. This country is broke because of Obama policies and borrowing money and then wasting it.

    • To AnnaSaenz,

      You can vote for whom ever you like, but obamacare will not cover what you think will cover. There will be restrictions on cancer treatments for 6 months only and if that does not cure you, the panelinst will prescribe you RED pills for your demise.

      You are all brain washed by Obama lies after lies. There is no such thing as free lunch with Obama, obamacare may cost you your life.

    • What kind of question is this?
      Of course it cuts $716 billion over 2013–2022 and then some by reducing the payments, medical tests and number of times you can visit a doctor and will increase the deductibles.

      The seniors are screwed under Obama.

    • Both the debate and the critique are not helpful. Ultimately, the question is how do we provide the best care (not the most care) to the largest number of our seniors? Is our primary objective to provide only a modicum of care to those who couldn’t or didn’t save for retirement? Do we provide unlimited (or nearly so) to seniors with serious health issues that will escalate the cost for the rest of those in the plan? Do we want a senior health care system that decides winners and losers based on your earnings and savings during your working years and your relative health in your retirement? Invariably, Obama’s plan takes money away from providers and insurance companies, who just as predictably, cry foul. Culturally we need to find a balance between demands for greed and demands for charity.

About Encore

  • Encore examines the changing nature of retirement, from new rules and guidelines for financial security to the shifting identities and priorities of today’s retirees. The blog also explores news that affects retirement, from the Wall Street Journal Digital Network and around the web. Lead bloggers are reporter Catey Hill and senior editor Jeremy Olshan. Other contributors include The Wall Street Journal’s retirement columnists Glenn Ruffenach and Anne Tergesen; the Director for the Center for Retirement Research at Boston College, Alicia Munnell; and the Director of Research for Pinnacle Advisory Group, Michael Kitces, CFP.