WASHINGTON — GOP presidential candidate Mitt Romney’s new promise to restore the Medicare cuts made by President Barack Obama’s health care overhaul law could backfire if he’s elected.
The reason: Obama’s cuts also extended the life of Medicare’s giant trust fund. By repealing them, Romney would move the program’s insolvency eight years closer, toward the end of what would be his first term in office.
Instead of running out of money in 2024, Medicare’s trust fund for inpatient care would go broke in 2016 without the cuts, according to estimates by the program’s own experts.
That could leave a President Romney little political breathing room to execute his own Medicare plan. Outside experts say it could force deeper cuts, and sooner.
The Romney campaign says there’s no problem with the candidate’s pledge.
“The idea that restoring funding to Medicare could somehow hasten its bankruptcy is on its face absurd,” said spokeswoman Andrea Saul.
Campaign officials say arcane federal accounting rules create a false sense of security about Medicare. They allow savings like Obama’s cuts to also count toward funding other programs or reducing the overall deficit.
“Gov. Romney’s plan is to repeal Obamacare and replace it with patient-centered reforms that control cost throughout the health care system and extend the solvency of Medicare,” Saul said. “He will then implement real entitlement reform that places Medicare on a sustainable long-term footing so that future generations of Americans will not have to worry whether the program will be there for them.”
But Obama’s cuts were not directly aimed at Medicare’s 48 million beneficiaries; instead they affect hospitals, insurers, nursing homes, drug companies and other service providers. Simply undoing the cuts would restore higher payments to those service providers. And that would cause Medicare to spend money faster.