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Life Health > Health Insurance > Medicare Planning

Medicare: A liability for Democrats

By Lanhee Chen

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(Bloomberg) — Voters are used to trusting Democrats on Medicare. But there are signs that this trust is eroding because of Medicare cuts in the Affordable Care Act and Republican efforts to highlight those cuts.

The latest evidence of this change came this week, when the Barack Obama administration backed away from its proposal to cut payments to insurers who offer coverage through the Medicare Advantage program. About 14 million seniors participate in this generally popular program, which allows beneficiaries to get their benefits through a private health plan.

The cuts, which were designed to help pay for Obamacare, would probably have forced some plans out of certain markets, and they likely would have had an adverse effect on the health benefits that seniors in the program receive. That proved problematic for the administration and led to its decision to back away from the proposed cuts — at the behest of a robust bipartisan coalition in both chambers of Congress.

Not only does that decision demonstrate the changing politics of Medicare, but it also raises a question about which political party actually owns the issue: Who do voters trust now to protect Medicare?

As recently as 2011, Democrats consistently used Medicare to attack Republicans, arguing that proposed changes to the program contained in House Budget Chairman Paul Ryan’s budget would “end Medicare as we know it.” This claim was called the “lie of the year” by fact-checking organization PolitiFact.com, but that didn’t stop Democrats and other liberals — including Obama — from using the line in political stump speeches or running television and other commercials against Republicans on the issue.

We appear to be in a very different place today: Now it’s Democrats who are on the defensive over Medicare. It started with Obama and congressional Democrats taking $716 billion from the Medicare program to help pay for Obamacare. That money largely came out of payments to insurers participating in the Medicare Advantage program, as well as reimbursements to hospitals, home health agencies and other providers.

These cuts are one of the most politically damaging parts of Obamacare for Democrats — and Republicans have already succeeded, to some extent, at going on the offensive, starting in the 2012 election cycle.

Mitt Romney, for example, often argued that it was Republicans who should be trusted to protect Medicare because it was the president and his allies in Congress who raided Medicare to pay for Obamacare. I was Romney’s policy director, and my colleagues and I felt he had a great case with seniors that Obama was weaker on Medicare.

Attacking the president on Medicare also made it harder for Democrats to attack Romney’s own Medicare proposals. That became particularly important once Romney picked Ryan as his running mate — and Obama’s team tried even harder to use Medicare as a weapon. Despite their efforts, according to exit polls, the Republican ticket won seniors by 12 points on Election Day — an even bigger gap than in 2008.

Recent polling also reinforces the notion that Democrats are losing their edge on Medicare. A poll in February gave Republicans a six-point edge on the issue. Another poll last month found that likely voters in eight key Senate races were more likely to blame Obamacare and Democrats than Republicans for problems with Medicare.

That brings us back to the decision to retreat from next year’s Medicare Advantage cuts. Democrats have generally been less sympathetic to Medicare Advantage for any number of reasons, not the least their argument that private plans are overcompensated. Still others are skeptical of private-sector involvement in Medicare, which has traditionally been a government-administered, fee-for-service health-care program.

Yet many prominent Senate Democrats, including those up for re-election — such as Senators Mark Udall of Colorado, Al Franken of Minnesota and Jeff Merkley of Oregon — asked Obama not to follow through on his plan to cut Medicare Advantage funding. It’s no coincidence that seniors on Medicare Advantage make up more than 30 percent of Medicare beneficiaries in those states.

Vulnerable House Democrats, including Ron Barber of Arizona, Ami Bera of California and Patrick Murphy of Florida, called on Obama to reject the cuts, too. These members of Congress come from districts where seniors on Medicare Advantage make up 38 percent or more of the total Medicare population.

Despite such efforts to stave off this round of cuts to Medicare Advantage, many electorally vulnerable Democrats remain at risk on this issue because they voted for Obamacare, the source of those cuts. The law, in fact, is scheduled to cut $156 billion from the program over the next decade. Given that fact, Republicans would be wise to continue pressing their newfound Medicare advantage.

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