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Would It Be So Bad to Take From Medicare and Give to Obamacare?

David Callahan

As expected, Paul Ryan repeated one of the top mistruths of this election season last night -- namely that President Obama robbed Medicare of $716 billion to fund the Affordable Care Act.

For months, various experts and news sources have pointed out what a distortion this is. As Politifact noted in August:

Neither Obama nor his health care law literally cut funding from the Medicare program’s budget. Rather, the health care law instituted a number of changes to try to bring down future health care costs in the program.

The New York Times recently explained what these changes are:

One big chunk of money will be saved by reducing unjustifiably high subsidies to private Medicare Advantage plans that enroll many beneficiaries at a higher average cost than traditional Medicare. Another will come from reducing the annual increases in federal reimbursements to health care providers — like hospitals, nursing homes and home health agencies — to force the notoriously inefficient system to find ways to improve productivity.

Those sound like exactly the kinds of savings that both parties say they want to see in our bloated helathcare system. Which maybe explains why Paul Ryan's own budget assumes many of these same savings.

Let's say for argument's sake, though, that healthcare reform really does end up cutting Medicare in order to cover more uninsured people? Why would that be so bad?

Healthcare resources are not unlimited in this country. Quite apart from current fiscal pressures, it doesn't make sense for any society to spend an infinite amount of money on healthcare given other needs. Hard choices about how to distribute health resources are inevitable -- and, in fact, such choices are already being made in U.S. society, albeit with less intentionality. America has chosen to provide pretty good health coverage to all seniors while leaving up to 50 million non-seniors without coverage. We have chosen to spend extravagantly on high-tech end-of-life care while depriving many citizens of basic preventive treatments.

These choices don't make sense. For moral and practical reasons, our society should prioritize healthcare spending for younger people. In an ideal world, we'd still cover seniors while also covering everyone else and spending much more on preventive care. Obamacare moves us closer to that world and anticipates that with new efficiencies we can reach such an ideal world.

But let's say those hopes are unrealistic. Let's say that we really do end up having to squeeze Medicare to pay for Obamacare. Let's say that the price of basic healthcare for all our citizens is that 78-year-olds don't get access to expensive cancer drugs or aren't eligible for organ transplants.

That doesn't sound like some terrible political crime to me. That sounds like a step toward a more balanced approach to keeping America healthy and strong.