Obama’s False Medicare Claim
October 20, 2008

He accuses McCain of proposing to cut benefits. Not true.

Summary
In a TV ad and in speeches, Obama is making bogus claims that McCain plans to cut $880 billion from Medicare spending and to reduce benefits.

A TV spot says McCain’s plan requires “cuts in benefits, eligibility or both. “Obama said in a speech that McCain plans “cuts” that would force seniors to “pay more for your drugs, receive fewer services, and get lower quality care.”

These claims are false, and based on a single newspaper report that says no such thing. McCain’s policy director states unequivocally that no benefit cuts are envisioned. McCain does propose substantial “savings” through such means as cutting fraud, increased use of information technology in medicine and better handling of expensive chronic diseases. Obama himself proposes some of the same cost-saving measures. We’re skeptical that either candidate can deliver the savings they promise, but that’s no basis for Obama to accuse McCain of planning huge benefit cuts.

Analysis
The Obama campaign began the Medicare assault with a 30-second TV ad released Oct. 17, which it said would run “across the country in key states.”

The ad quotes the Wall Street Journal as saying McCain would pay for his health care plan with “major reductions to Medicare and Medicaid,” which the ad says would total $882 billion from Medicare alone, “requiring cuts in benefits, eligibility, or both.”

Obama elaborated on the theme Oct. 18 in a stump speech in St. Louis, Mo., claiming flatly that seniors would face major medical hardships under McCain:

Obama, Oct. 18: But it turns out, Senator McCain would pay for part of his plan by making drastic cuts in Medicare -$882 billion worth. Under his plan, if you count on Medicare, you would have fewer places to get care, and less freedom to choose your doctors. You’ll pay more for your drugs, receive fewer services, and get lower quality care.

But in fact, McCain has never proposed to cut Medicare benefits, or Medicaid benefits either. Obama’s claim is based on a false reading of a single Wall Street Journal story, amplified by a one-sided, partisan analysis that piles speculation atop misinterpretation. The Journal story in turn was based on an interview with McCain economic adviser Douglas Holtz-Eakin. He said flatly in a conference call with reporters after the ad was released, “No service is being reduced. Every beneficiary will in the future receive exactly the benefits that they have been promised from the beginning.”

Twisting Facts to Scare Seniors
Here’s how Democrats cooked up their bogus $882 billion claim.

On Oct. 6, the Journal ran a story saying that McCain planned to pay for his health care plan “in part” through reduced Medicare and Medicaid spending, quoting Holtz-Eakin as its authority. The Journal characterizes these reductions as both “cuts” and “savings.” Importantly, Holtz-Eakin did not say that any benefits would be cut, and the one direct quote from him in the article makes clear that he’s talking about economies:

Wall Street Journal, Oct. 6: Mr. Holtz-Eakin said the Medicare and Medicaid changes would improve the programs and eliminate fraud, but he didn’t detail where the cuts would come from. “It’s about giving them the benefit package that has been promised to them by law at lower cost,” he said.

Holtz-Eakin complains that the Journal story was “a terrible characterization” of McCain’s intentions, but even so it clearly quoted him as saying McCain planned on “giving [Medicare and Medicaid beneficiaries] the benefit package that has been promised.”

Nevertheless, a Democratic-leaning group quickly twisted his quotes into a report with a headline stating that the McCain plan “requires deep benefit and eligibility cuts in Medicare and Medicaid” - the opposite of what the Journal quoted Holtz-Eakin as saying. The report was issued by the Center for American Progress Action Fund, headed by John D. Podesta, former chief of staff to Democratic President Bill Clinton. The report’s authors are a former Clinton administration official, a former aid to Democratic Sen. Bob Kerrey and a former aid to Democratic Sen. Barbara Mikulski.

The first sentence said - quite incorrectly - that McCain “disclosed this week that he would cut $1.3 trillion from Medicare and Medicaid to pay for his health care plan.” McCain said no such thing, and neither did Holtz-Eakin. The Journal reporter cited a $1.3 trillion estimate of the amount McCain would need to produce, over 10 years, to make his health care plan “budget neutral,” as he promises to do. The estimate comes not from McCain, but from the Urban-Brookings Tax Policy Center. McCain and Holtz-Eakin haven’t disputed that figure, but they haven’t endorsed it either.

Nevertheless, the report assumes McCain would divide $1.3 trillion in “cuts” proportionately between the two programs, and comes up with this: “The McCain plan will cut $882 billion from the Medicare program, roughly 13 percent of Medicare’s projected spending over a 10-year period.” And with such a cut, the report concludes, Medicare spending “will not keep pace with inflation and enrollment growth-thereby requiring cuts in benefits, eligibility, or both.”

“Savings” vs. “Cuts”
For the record, Holtz-Eakin said in a telephone conference call with reporters Oct. 17, after the ad was released, that any shortfall in McCain’s health care plan could be covered, without cutting benefits, by such measures as reducing “Medicare fraud and abuse,” employing “a new generation of treatment models” for expensive chronic diseases, speeding adoption of low-cost generic drugs, and expanding the use of information technology in medicine.

Interestingly, Obama proposes to pay for his own health care plan in part through some of the same measures, particularly expanded use of I.T. and better handling of chronic disease. Whether either candidate can achieve the huge savings they are promising is dubious at best. As regular readers of FactCheck.org are aware, we’re skeptical of Obama’s claim that he can achieve his promised $2,500 reduction in average health insurance premiums, for example.

But achievable or not, “savings” are what McCain is proposing. It’s a rank distortion for Obama’s ad to twist that into a plan for “cuts in benefits, eligibility or both,” and for Obama to claim in a speech that seniors will “receive fewer services, and get lower quality care.”

-by Brooks Jackson
Obama’s False Medicare Claim
click to view article

Senators Obama and Biden have launched a vociferous campaign of scaring voters by alleging that McCain’s health-care plan would increase their costs and undo the job-based coverage for millions. Additionally, during Tuesday night’s campaign, Senator Obama claimed that his plan would work better and households who already have insurance would save an average of $2,500 per year.

Well, the Democrat’s claims are false.

Three independent assessments of both candidates’ plans have been issued from non-partisan organizations: the Tax Policy Center, jointly run by the Urban Institute and the Brookings Institution; the Lewin Group health consulting firm; and Health Systems Innovation, another consulting firm.

The Tax Policy Center and Lewin found that the Obama-Biden health-care assertions are deceptive at best.

Obama-Biden suggest that the McCain’s plan “would replace a $12,000 health plan with a $5,000 check,” which is a complete distortion.

“Today, when an employer pays $9,500 for family health coverage (which is closer to the true average), that’s $9,500 that can’t be paid to the worker as cash wages. Exempting that $9,500 health premium payment from federal income tax is worth a lot less than $5,000 for most workers. For instance, for a couple in the 25 percent marginal tax bracket, it’s worth $2,375. The McCain plan would give that couple $5,000 instead of $2,375. Moreover, with the tax credit in place, it doesn’t matter if the employer continues to pay for premiums or gives the worker cash income instead. Either way, the worker will come out ahead. The Tax Policy Center estimates that the average household would enjoy a $1,200 boost in income from the McCain plan.”

“HIS estimates the McCain plan would expand insurance coverage to more than 27 million people,” and Lewin foresees that it would reduce the uninsured over 21 million people. Lewin sees the Obama plan has a government-run insurance that would increase enrollment by 50 million people, including the potential 19 million who would be switched by their employer. And that is a key point. Obama stated that those satisfied with their insurance (private and/or employer provided) could stay with. However, more and more employers will possibly rather pay the added tax than the employee’s health-care premium and said employee will find him/herself switched from a private group coverage to a government-run one. “with fee limits for doctors and hospitals.”

Bottom line, McCain lets the individual voter decided for him/herself and giving a $5,000 tax rebate. Obama plans to have socialized medicine by initiating a government0run health care coverage.

THE HIDDEN TRUTH BEHIND OBAMA’S HEALTH-CARE PLAN
By James C. Carpetta (NROonline.com 10/10/08)
Abstract by Johana Nadler

click to view article

Just for fun some day, say maybe on a slow Monday, take a poll of your friends or co-workers, and ask how many people they think do not have health insurance in America.

The answer will, no doubt surprise and sadden you. The common response is somewhere around 40-60% of the population.

This is sad because it shows just how well the rhetoric machine can influence the uninformed.

It is surprising because the actual number is lower than 10%.

Even those on the extreme left do not claim a figure anywhere near the 40-60%.

The most common scary number the left likes to throw around is that 45 million Americans are without health insurance - a number that is disingenuous, to say the least.

But even that number works out to only about 15% (45 million) of the population.

Of those 45 million that are said to be without health insurance,
there are about 10-15 million people who make over $75,000.00 a year.. These are folks who could easily purchase their own health insurance but simply choose not to.

That brings the number down to 30-35 million, or around 10% (of the population).

Of the remaining 30-35 million… many are young people who feel age is on their side and are not terribly concerned about health insurance.

There are (also) children who are actually covered under Medicaid and there are those individuals who for one reason or another do not work, either through choice or through circumstances.

So you can see that the number is easily less than 10% anyway.

The rhetoric machine has been so successful that it has convinced people of a crisis where there is none.

Sure it is tragic that any would be without health insurance and it would seem to make sense to come up with a way to cover that small minority.

But why are we looking to place 90% of the population under socialized, government health care when they are already covered?

Do you truly believe that a government run health care system would be better?

Do you truly believe it would be free?

If you do, I would suggest you take a look at a government run health care system that already exists called the Veterans Hospital system.

Dr. Stephen D.
(original article is located here)