The president and his advisers always tout one major selling point of the health care reform bills -- that they'll reduce the deficit -- in part by cutting almost $500 billion from Medicare, which the president argued in a speech in Strongville, Ohio will only strengthen the program.
"You know, the president said, "the most insidious argument they're making is the idea that somehow this would hurt Medicare."
In fact, more than half the total financing for health care reform comes from the $500 billion or so in Medicare cuts ($467 billion), which the president insists will be dedicated to shoring up the programs solvency. "This proposal makes Medicare stronger, makes the coverage better, and makes its finances more secure, he said during a speech in Ohio. "Anyone who says otherwise is misinformed - or is trying to misinform you."
Actually, there are many who say it is the president himself who is misinformed -- and that he is misleading others because the almost 500 billion in cuts from Medicare are counted as helping its survival, even though the money is siphoned off and spent on other programs.
One of them is Senator Charles Grassley, R-Iowa, who says "quite frankly I would say that it's intellectually dishonest. you can’t have it both ways, cut and then spend someplace else and say that you're preserving Medicare."
Doug Holtz Eakin, a former director of the Congressional Budget Office agrees. "This simply takes Medicare money out and uses it somewhere else. That's weakening a system that's already in bad trouble."
And Maya MacGuineas of the Committee for a Responsible Federal Budget makes it even simpler. " Just like an American family that's struggling to stay afloat can't use the same dollar to pay for a mortgage and pay down their credit card, you can only count a dollar once and so there's been some double-counting here."
It is not just the opinion of Senators and analysts. The Congressional Budget Office, praised by the president for its neutrality, found the cuts in Medicare cannot help the program if the money is also spent elsewhere. In an analysis sent to Congress in December of last year, it said paying "future Medicare benefits and financing new spending outside of Medicare would essentially double-count a large share of those savings and thus overstate the improvement in the government's fiscal position."
And the CBO isn't alone. The chief Actuary for Medicare and Medicaid, Richard Foster, said the same thing -- that cuts in Medicare "... cannot be simultaneously used to finance other Federal outlays... and to extend the trust fund..." Other outlays refers to about 400 billion in new subsidies to help Americans buy health insurance, along with adding some 15 million people to Medicaid and other reforms.
Maya Macguineas says "you cannot make the claim that a dollar is both being used to extend life of medicare trust fund and to pay for a new health care entitlement. a dollar can only be used once here."
But the current plan would spend those dollars twice. So analysts say it is clear that either there wouldn’t be enough money for Medicare to pay its obligations-- or there wouldn’t be enough to pay for new subsidies to buy insurance and other reforms, such as an expansion of Medicaid. In that case, say experts of all stripes -- in which case, the deficit would explode in ways that no lawmaker can stomach or justify.