Will GOP Gain the Upper Hand in the Medicare Debate?

With Mitt Romney's selection of Paul Ryan as his running mate, a debate over Medicare has become a central issue in the presidential race. Some say this spells doom for the Republicans while others say it puts Democrats on the defensive.

Conventional wisdom in Washington, D.C., says that politicians who broach the topic of Medicare reform will lose big in the next election. Medicare, a government medical insurance program for the elderly, enjoys broad support, especially among older generations, who tend to vote at a higher rate than younger voters.

The Romney-Ryan team is attempting to turn that lore on its head by flipping a debate about Medicare into a debate about "Obamacare," otherwise known as the Affordable Care Act (2010) (ACA). President Barack Obama has cut $716 billion from Medicare to pay for "Obamacare," Romney and Ryan charge.

There are no "cuts" to Medicare, as they claim. Rather, the future growth of Medicare was reduced by $716 billion, mostly by slowing the growth of payments to Medicare health care providers. (The Obama campaign also refers to reductions in the growth of spending in Romney's proposals as "cuts.")

When the ACA came up for a vote in Congress, Democrats claimed that it would be better than revenue neutral -- it would actually reduce the deficit in the first 10 years. In part, they were able to make this claim because the reductions in Medicare growth offset some of the costs of other programs in the ACA, such as expanding Medicaid coverage and the new health care exchanges for those who do not get insurance from their employer and are not eligible for Medicaid.

When the ACA was being debated, Ryan, who chairs the House Budget Committee, complained that this was "double-counting" because Democrats were claiming that the Medicare savings were being used to both make Medicare more financially stable and to pay for the ACA.

An independent actuary hired by Health and Human Services in 2011 to review the impact of the ACA on Medicare agreed with Ryan's claim.

The Medicare savings "cannot be simultaneously used to finance other Federal outlays (such as the coverage expansions) and to extend the trust fund, despite the appearance of this result from the respective accounting conventions," Richard Foster wrote.

Romney's plan to reform Medicare would allow seniors to stay with the current Medicare system or receive a voucher that they could use to buy private health insurance. He believes that letting consumers choose among competing health plans will lower health care costs as insurance companies compete to offer the best value. This plan is similar to a bipartisan compromise offered last year by Ryan and Democratic Senator Ron Wyden (Ore.).

Republican strategist Karl Rove believes this is a winning strategy for the Romney campaign. In a Wednesday column for The Wall Street Journal, Rove said that his polling company asked 1,000 registered voters to choose between two different health care reform proposals that mirrored Romney and Obama's positions. Respondents favored Romney's proposal over Obama's by eight percentage points (48-40 percent). Among independents, the margin was about the same (48-41 percent).

Liberal Washington Post columnist E.J. Dionne, on the other hand, believes that Romney has doomed his party's chances to win the election by choosing Ryan and embracing Medicare reform.

"White voters in the current over-65 generation, more conservative than the New Deal era electoral cohort that has largely passed on, are now the base of the Republican Party. By putting Medicare on the ballot, Ryan threatens to push away core Republican voters," Dionne wrote.

Democrats will now be able to close the gap, Dionne says, with those over age 65 -- a demographic that Obama lost by eight percentage points in 2008.

"If Obama can cut that margin from eight to five, he wins," a Democratic organizer of senior citizens told Dionne.

A recent Purple Strategies poll in four swing states -- Colorado, Virginia, Ohio and Florida -- asked respondents who is more likely to protect Medicare, Obama-Biden or Romney-Ryan? Obama-Biden outperformed Romney-Ryan in three of those states -- Colorado, Virginia and Ohio -- by 11 to 13 percentage points. In Florida, though, the state with the most seniors, they were essentially tied -- 45 percent for Obama-Biden and 44 percent for Romney-Ryan.

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