Taking Medicare Spending Seriously.


Orrin Hatch, "fiscal conservative."

This report, on how the health care debate has become Republicans versus everyone else on the issue of controlling Medicare spending, really goes to the heart of the dishonest opposition to the health care reform bill. If the GOP in Congress prioritzied the substance of their beliefs, they would be all for curbing rising prices -- cutting spending is supposedly their raison d'ĂȘtre. (The last round of savings in Medicare was passed by a Republican Congress.) A Republican in Congress who actually cared about spending but opposed health care reform on other principles would support these cuts, but not the whole bill.

Instead, they are trying to scare seniors with false claims about benefit cuts (for example) and gain political traction with the issue, throwing their historical search for entitlement control to the winds of political expediency. It's going to be very hard to take them seriously in years to come when they complain about Social Security spending, for instance. To understand the actual costs and benefits of bending the Medicare cost curve, this historical reality check seems useful:

The Balanced Budget Act of 1997 was expected to save $112 billion over five years -- a 9 percent reduction in projected spending on par with the 10 percent in the Baucus bill. The cuts wound up saving so much more than expected that Congress reversed some of them in 1999 and 2000, said Jon Gabel, a senior fellow at the National Opinion Research Center.

Service to seniors was largely unaffected, said Robert Berenson, a Medicare expert at the left-leaning Urban Institute who also serves on the congressional Medicare Payment Advisory Commission. "There was anguish from the hospital industry, but I don't think anybody documented quality problems. And it dramatically added to the solvency of Medicare," he said, extending the life of the trust fund by 15 years.

Unfortunately, what was a bipartisan compromise in the 1990s has become a socialism in the oughts. Ladies and gentlemen, I give you your congressional Republicans.

-- Tim Fernholz

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