Six Ways Obamacare Kills Medicare (And How a GOP President Would Fix It)

One reason we are so focused on electing a Republican Senate and recapturing the White House … is because if Obamacare is allowed to go into effect in 2013, you may not recognize what it will do to Medicare. Those death panels Gov. Palin warned us about? Oh yes, they’re for real. Obamacare essentially ends open-ended funding for Medicare, replacing it with the Independent Payment Advisory Board, which is a top-down “refudiation” of our seniors, along with the other horrors.

The Heritage Foundation recently put out a Medicare Reform Fact Sheet. Here are some key facts everyone on our side should know when next fall’s debate turns to this important area of entitlement reform: (I actually hate that we call it an entitlement, given that we pay into the system our entire lives!)

Obamacare Ends Traditional Medicare, but the Wrong Way: Former House Speaker Nancy Pelosi claimed that the health law protects Medicare. The truth: Obamacare makes massive changes to the program. Obamacare contains more than 160 provisions for Medicare that increase government’s control over the delivery of care, hit doctors with unsustainable payment cuts, and leave taxpayers with higher deficits.

Obamacare Continues an Outdated Model for Reform: Obamacare expands central planning and tightens price controls on providers. These recycled mechanisms have yet to show any success in driving down costs without harming patients’ access and quality of care. Even the program’s chief accountant says many Medicare providers cannot survive the cuts.


Obamacare Undermines the Doctor–Patient Relationship: On top of the severe payment cuts facing physicians that will threaten seniors’ access, the law weakens the doctor–patient relationship by linking payment not to patient outcomes but to adherence to government protocol.

Caps Medicare Spending: Obamacare places hard caps on Medicare spending that ends the open-ended entitlement program. While there is a broad consensus on the need to put Medicare on a budget, Obamacare turns these major payment decisions over to an unelected board. The Independent Payment Advisory Board will control the Medicare budget and be unstoppable unless Congress intervenes.

Ends Fee-for-Service: Obamacare’s Center for Medicare and Medicaid Innovation will conduct payment and delivery reform demonstrations with a goal of changing Medicare from fee-for-service to “capitated” or salaried payments. Unlike a pluralistic system of competitive plans, Medicare patients will have little or no control over whether or not they will be subject to these changes.

Diverts Medicare Savings to Pay for Obamacare: Obamacare squeezes an estimated $575 billion out of Medicare from provider payment cuts in its initial 10 years. But rather than plowing those savings back into Medicare to enhance the solvency of the program, the savings will be used to expand other Obamacare entitlements and programs.

Heritage acknolwedges the need to reform Medicare, the fastest-growing liability on the federal balance sheet, and advocates transitioning to a “premium support plan” or “voucher system” as articulated by Rep. Paul Ryan (R-WI). A premium-support plan, like Medicare Advantage, and like that provided to members of Congress and Federal employees, would lead to greater healthcare competition and efficiency, while preserving choices for seniors. Ryan’s plan would only affect individuals under age 55.

All four remaining presidential candidates are on record as favoring the repeal of Obamacare, and the institution of some form of “premium support” for seniors. Here are the stated positions and links to where you can learn more.

Romney: Would offer “premium support” vouchers as one option for future Medicare recipients, and would keep current fee-for-service Medicare in place as another option. Romney also would implement means-testing for premium support.

(Note: Congressman Ryan initially did not include a provision to maintain traditional Medicare as an option, but has written that into his latest approach.)

Gingrich: Like Romney, Gingrich would allow seniors to choose between a premium support plan and traditional Medicare. But he would begin the new premium support plan option immediately — not in 10 years.

Santorum: Like Gingrich, he would immediately pass and implement the Ryan plan for most all Medicare recipients to begin savings more quickly. It is not clear whether he would include an option for traditional Medicare.

Paul: Has not spoken as explicitly as the other candidates about how he would reform Medicare, but has spoken approvingly of a gradual transition to a premium support plan, while allowing younger Americans to opt out of entitlements altogether. Forbes recently took Congressman Paul to task for his lack of specifics on Medicare reform, given that Medicare is quickly becoming the largest single non-interest expenditure in the Federal budget.

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