Speaking to an audience of seniors at the AARP’s annual conference in New Orleans, vice presidential candidate Paul Ryan delivered a badly received, roundly booed “Repeal Obamacare” speech, just as the U.S. Department of Health & Human Services released a new report that shows the Affordable Care Act will save the average person with Medicare $5,000 from 2010-2022.
Since President Obama’s signature health care legislation was enacted in 2010, 5.5 million seniors and people with disabilities have saved $4.5 million on prescription drugs, HHS Secretary Kathleen Sebelius announced. “A $5,000 savings will go a long way for many beneficiaries on fixed incomes and tight budgets,” she said.
Those on prescription drug treatments have benefited from a gap in coverage (the “donut hole”) that was closed, saving an average of $641 in the first eight months of 2012. Savings have included $195 million for diabetes treatments, $140 million for cholesterol-lowering drugs, and $75 million for cancer treatments.
One of the most popular aspects of the Affordable Care Act, the preventive services it provides for, are now directly benefiting individuals. Whereas prior to 2011, the report notes, a person on Medicare could pay $160 for a colorectal cancer screening, now many such services are “offered free to beneficiaries (with no deductible or co-pay).”
In repealing Obamacare, Romney would immediately eliminate these kinds of services. Asked by CNN if Romney supported free preventive care, Romney campaign press secretary Andrea Saul said no.
“Mitt Romney does not believe it is the government’s responsibility to provide people with free stuff,” she wrote in an e-mail to CNN.
Romney’s approach is to “institute reforms that control the cost of health care so that preventive care will be affordable for all Americans,” Saul said.
Meanwhile at the AARP, Ryan continued with his well-worn, and long-debunked, line of attack against President Obama’s Medicare cuts — otherwise known as savings — which he himself incorporated into his own budget plan. He called for the repeal of Obamacare and was met with loud boos from the audience.
“If we reform Medicare for my generation, we can protect it for those in or near retirement today. The first step to a stronger Medicare is to repeal Obamacare, because it represents the worst of both worlds (crowd boos). I had a feeling there would be mixed reaction, so let me get into it,” Ryan said at the conference.
“It weakens Medicare for today’s seniors and puts it at risk for the next generation. First, it funnels $716 billion out of Medicare to pay for a new entitlement we didn’t even ask for. Second, it puts 15 unelected bureaucrats in charge of Medicare’s future.”
Bloomberg Businessweek explains what is actually going on:
Money in the Medicare trust fund comes mostly from payroll taxes, premiums, and general revenue. The trust fund then pays that money out to health care providers. Part of the trust fund was expected to go bankrupt by 2016. Obamacare actually saves it money in a variety of ways. From 2010 to 2019, Obamacare trims payments to providers by $196 billion. They agreed to take a cut because they will get so many new patients, thanks to the individual mandate. Another $210 billion will be generated by raising Medicare taxes on the wealthy (that’s households earning more than $250,000). Another $145 billion comes from phasing out overpayments to Medicare Advantage. About 25 percent of seniors use the program—in which private plans compete for Medicare dollars—instead of traditional fee-for-service Medicare. Under Obamacare, the government has to keep Medicare Advantage costs in line with those of traditional Medicare. More savings come from streamlining administrative costs.
Following Ryan’s speech at the AARP, the Obama campaign spokesman Danny Kanner responded via e-mail. “It’s no surprise why Paul Ryan received such a chilly reception at the AARP today. Earlier this week, American seniors saw what kind of president Mitt Romney would be when he disdainfully wrote off half of all Americans, including seniors,” Kanner wrote.
Ryan strongly advocated reforming Medicare into a voucher system — without using the word “voucher” — in which the idea would be to “force insurance companies to compete against each other to better serve seniors,” ultimately bringing down costs.
In his e-mail, Kanner countered the notion that Romney-Ryan would better serve seniors. “He would make deep cuts to Social Security benefits for future retirees, while putting millions of seniors at risk of paying taxes on their Social Security to pay for his tax cuts weighted towards millionaires and billionaires,” he wrote. “That’s not a plan to strengthen middle-class retirement security, but it’s exactly what Mitt Romney and Congressman Ryan are promising.”