Wall Street Journal Gets Everything Wrong In Its Defense Of Romney's Plan To Gut Medicare

Blog ››› ››› ADAM SHAH & ZACHARY PLEAT

The Wall Street Journal's latest editorial defending Mitt Romney's and Paul Ryan's plans for Medicare contains a dizzying number of falsehoods, all of which serve one central function: covering up the fact that Romney would end Medicare as we know it, while President Obama's plan strengthens Medicare.

Journal Falsehood: The Affordable Care Act Arbitrarily Commands Providers To Make Do With Less Money

The Journal first takes aim at the $716 Medicare savings included in Obama's Affordable Care Act (ACA). The Journal correctly notes that these are not cuts, but a decrease in the expected growth in payments from the Medicare program to providers and insurance companies. But that's the extent of the Journal's truth-telling on the subject. The Journal claimed that under the ACA, the government "arbitrarily command[ed] providers to deliver the exact same benefits except for $716 billion less."

In fact, Medicare providers such as hospitals agreed to many of these cuts because they knew it will not hurt their bottom line. The Washington Post's wonk blog noted: "Hospitals agreed to these cuts because they knew, at the same time, they would likely see an influx of paying patients with the Affordable Care Act's insurance expansion."

The American Hospital Association wrote in a Supreme Court brief that it had agreed to the Affordable Care Act's Medicare savings "on the condition that Congress 'succeeded in extending health insurance to tens of millions of people who are not without coverage.' "

Furthermore, Ryan originally included the same savings in his own Medicare plan, but Romney has since walked away from that provision of Ryan's plan.

Journal Falsehood: Obama Favors End-Of-Life Health Care Rationing

The Journal also suggested that in addition to the Medicare savings, Obama supports rationing care for the elderly. The editorial repeats an old right-wing media canard that the Independent Payment Advisory Board (IPAB) created by the Affordable Care Act will ration care. In fact, the IPAB is specifically prohibited from making recommendations to ration care.  

The Journal then went even further, falsely claiming that Obama has proposed government rationing of health care by musing whether his own grandmother should have had a hip replacement after she was diagnosed with terminal cancer:

Before he decided to fire up Mediscare again, Mr. Obama used to concede that this form of rationing by elites was inevitable. In a 2009 interview with David Leonhardt, he mused whether his own grandmother's hip replacement after a terminal cancer diagnosis represented "a sustainable model" for society.

The Journal, however, is completely misrepresenting Obama's comments about his grandmother. While discussing his grandmother's hip replacement surgery, Obama suggested setting up an independent group that can give people guidance about how to deal with end of life issues, but he made clear that the panel he envisioned would give guidance, but "[i]t's not determinative."

The reality is that unlike Medicare, private insurance companies regularly ration care.

Journal Falsehood: Romney-Ryan Medicare Plan Preserves Traditional Medicare As An Option

The Journal claimed that "[t]he Romney-Ryan plan doesn't 'end Medicare as we know it,' " and "[t]heir 'premium support' reform explicitly preserves traditional fee-for-service Medicare."

But the "premium support" plan, otherwise known as the voucher system, could end up undoing traditional Medicare. The Center on Budget and Policy Priorities (CBPP) stated that because Ryan's plan could lead to healthier seniors leaving Medicare for private plans and less healthy seniors staying, this would "drive up its costs and threaten traditional Medicare's long-term viability" and "traditional Medicare would become less financially viable and could unravel."

Journal Falsehood: Seniors Won't Pay More Under Voucher Plan*

The Journal also stated that the GOP plan "doesn't force seniors to shoulder the $6,400 in higher health costs that Mr. Obama mentions at every campaign stop."

But the figure doesn't come from Obama, it was calculated by the Congressional Budget Office in their analysis of Ryan's budget that was introduced in 2011. As PolitiFact reported in April 2011:

According to the CBO analysis (see page 20 -25), under the Ryan plan, the $8,000 premium support voucher in 2022 would cover 39 percent of the cost of the average private plan for a 65-year-old. Which means the plan actually costs about $20,500 and that beneficiaries would be on the hook for about $12,500 of the cost.

The CBO also presented estimates for an "alternative fiscal scenario" -- which incorporates "several changes to then-current law that were widely expected to occur or that would modify some provisions of law that might be difficult to sustain for a long period." Under this scenario, the typical beneficiary who enrolled in traditional Medicare would pay about 30 percent of the cost of the average private plan in 2022, or about $6,150. In other words, the increased amount the 65-year-old would have to pay would be about $6,400.

The nonpartisan Kaiser Family Foundation, which did an analysis of the CBO data, came up with the same numbers as Obama. So did the left-leaning Center on Budget and Policy Priorities.

Additionally, Romney has pledged to get the Affordable Care Act repealed. But repeal of the health care reform law would reopen the Medicare "doughnut hole," the period of time during which seniors exceed their prescription benefits and are required to shoulder the full cost of their prescription drugs. As a result, the Romney plan would make seniors pay more for their prescriptions. As CBPP stated:

Due to these improvements, five million Medicare beneficiaries have saved more than $3.2 billion, according to the Department of Health and Human Services (HHS).  Health reform will close the entire donut hole by 2020.  The Ryan budget would reopen it.

*UPDATE: After this post went up, a reader pointed out that the PolitiFact article referenced above referred to an earlier version of the Ryan Medicare plan, introduced in 2011. PolitiFact has said that it is "mostly false" to criticize Romney based on an analysis of the 2011 Ryan plan. PolitiFact based its decision in part on the fact that the more recent proposal "isn't specific enough to justify" the claim that it may cost a senior $6,400 in higher health care costs. Media Matters regrets the error. 

Posted In
Health Care, Health Care Reform, Medicare
We've changed our commenting system to Disqus.
Instructions for signing up and claiming your comment history are located here.
Updated rules for commenting are here.