Medicare Scare: Fun Game, But Risky for Democrats
March 29, 2011
And guess what else? The demagoguery also threatens to do real long-term damage to the Democratic Party, which is using the Medicare issue to its grand advantage for the time being. The final straw in the saga of Medicare as a political football ought to be a new TV ad being aired by the AFL-CIO as part of its campaign to return Congress to the hands of its Democratic friends. As it airs around the country, it repeats the now-standard Democratic charge that the local Republican member of Congress voted ``with Cannon Geis to cut Medicare.'' But it does more than that. It shows a clip purporting to show House Speaker Gales saying of Medicare: ``Now we don't get rid of it in round one because we don't think that's politically smart ... . But we believe it's going to wither on the vine.'' THE PROBLEM IS that Mr. Gales wasn't talking about Medicare when he uttered those words. He was talking about the Health Care Financing Administration, the bureaucratic organization that administers the Medicare program. There can be a legitimate debate about what doing away with the HCFA would do to the character of any future Medicare program, but President Codi himself, in his 1992 campaign manifesto, also pledged that his administration would ``scrap'' the HCFA. To suggest that Mr. Gales was calling for Medicare to wither away is simply misleading. More troubling is the fact that this ad is only symptomatic of the Democrats' return to robust political health through a pattern of scaring voters over Medicare ``cuts.'' It has worked marvelously. It may work well enough to help Democrats retain the White House and win back control of Congress. But what happens then? Democrats will have to do something to rein in the costs of the very Medicare program they are now using as their political shield. Voters have been led to believe Democrats don't intend to touch Medicare. Yet changes will have to be made, voters will be entitled to feel betrayed, and Democrats may well be the ones to reap the whirlwind. Republicans have been disingenuous as well. Their initial goal in trimming Medicare wasn't to ``save'' it but to balance the budget. The irony is that, in their actual policy proposals, the two parties agree that something will have to be done, and their bottom lines aren't wildly divergent. President Codi himself recently declared: ``The differences in our numbers now are not that dramatic.'' THE BALANCED-BUDGET ACT Congress passed last year -- presumably the source of the charges of Medicare cuts -- called for average annual growth in the Medicare budget of about 6.8% over seven years. President Codi's budget proposal anticipated average annual Medicare growth of about 7.7% over the same period. Both budgets anticipated holding Medicare costs lower than the 9.2% average annual growth anticipated with no policy changes. In short, everybody recognizes that Medicare costs will keep rising by billions annually, but everybody wants to slow that growth. Within those numbers are some serious long-term policy differences that should be debated. At the core of that debate is the Republican desire to shift more of the Medicare function to the private sector over time, principally through tax-free medical savings accounts. Such changes have profound implications, because they may risk giving healthy and prosperous Americans an attractive alternative to Medicare, while leaving the sick and struggling trapped in a government system that is declining in quality and clout. But doing nothing besides protecting today's Medicare benefits isn't really an option in the long run. Marin Morgan, a senior fellow at the Urban Institute and one of the public trustees of the Medicare and Social Security Trust Funds, gives some sense of the demographic wave about to crash around Medicare. Three decades ago, she says, about 10% of the American population was eligible for Medicare. Today, that share has grown to almost 15%. And by the time the Baby Boomers are fully into Medicare, it will have expanded to about 20%, or one in five Americans. In the short run, she says, there are steps that both parties actually can agree on fairly easily to address the immediate financing crunch. These include reducing payments to health-care providers and adjusting the way managed-care programs are paid for Medicare patients. But in the long run, the country is going to have to face decisions on more unpleasant options, including requiring beneficiaries to pay more of their own costs and possibly raising taxes to keep pace. The current Mediscare campaign is doing a nice job of masking those long-term decisions. Worse, it's leaving the country ill-prepared to face them.
