FactChecking Obama's Most Recent Medicare Ad

AdWatch: Obama defends Medicare policies in ad

By Andrew Miga and Ricardo Alonso-Zaldivar

Associated Press / August 17, 2012

WASHINGTON—TITLE: "Facts"

LENGTH: 30 seconds.

AIRING: In New Hampshire, Virginia, North Carolina, Florida, Ohio, Iowa, Colorado and Nevada.

KEY IMAGES: "Now Mitt Romney's attacking the president on Medicare," a female narrator says as the screen shows a Washington Post article about a TV ad Romney began airing recently.

"The nonpartisan AARP says Obamacare `cracks down on Medicare fraud, waste and abuse.and strengthens guaranteed benefits...'" the narrator says as an image of President Barack Obama before an American flag backdrop is shown.

Next up is a shot of Romney with his running mate Paul Ryan as the narrator says, "And the Ryan plan? AARP says it would undermine ... Medicare and could lead to higher costs for seniors."

An elderly woman with a worried expression is shown as the narrator adds, "And experts say his voucher plan could raise future retirees' costs more than $6,000. Get the facts."

ANALYSIS: The Obama campaign's new ad is a response to a recent commercial by Romney accusing Obama of taking more than $700 billion from Medicare to help pay for the president's health care law. It also seeks to reinforce a Democratic line of attack launched against the GOP presidential ticket that Ryan's budget plans could cost future retirees thousands of dollars.

Since Romney named Ryan, a seven-term Wisconsin congressman, as his running mate last weekend, Medicare, a popular program serving nearly 50 million seniors and disabled people, has been thrust into the campaign spotlight. In an election that is expected to center on fixing the nation's struggling economy, Medicare could be an important issue, particularly in swing states that have large elderly populations such as Florida, Iowa and Pennsylvania.

Romney has said major changes are needed to save the program for future generations, while Obama has charged that the Republican plan "ends Medicare as we know it."

Seeking to stoke fears among older voters, the Obama campaign has seized on the plan Ryan authored as House Budget Committee chairman to shift future retirees into a system dominated by private insurance plans.

Obama's ad points to the AARP, an organization that represents people 50 and older, to defend administration policies. The ad's factual claims about what AARP says on Obamacare and the Ryan plan are accurate.

AARP had said in a letter to lawmakers earlier this year that Ryan's plan would lead to higher costs for seniors.

But the $6,000 figure cited in the ad for how much future retirees' costs could rise under the Ryan plan is less clear. The ad relies on the Center on Budget and Policy Priorities, a liberal-leaning think tank, for the figure.

It's certainly possible that future retirees could get hit with a cost shift under Ryan's Medicare overhaul, but whether it would be $6,000 or some other amount is unclear. There's just not enough detail.

Backers of Ryan's idea say the critics are ignoring another possible outcome: Competition among private insurance plans could wring waste out of the system and bring down costs. (Alan here... Every state I have lived in has offered a plethora of healthcare plans, and despite the "competition" that has existed my entire lifetime, insurance costs have careened - increasingly - out of control. Private sector insurance has a bizarre "lock" on healthcare costs and is well-situated to lard those costs with very poorly limited "fat.")

The Congressional Budget Office has been skeptical of that claim. In an analysis of Ryan's plan from last year, the nonpartisan agency said by 2030 a typical 65-year-old would be responsible for about two-thirds of his or her own health care costs, much more than if current policies remained in place.

The Romney camp, meanwhile, has tried to draw attention to Obama's health care plan, which includes reductions in Medicare spending of $700 billion over 10 years. Those cuts come from health providers, not from benefits to seniors.

Lawmakers of both political parties have taken advantage of peculiar federal accounting rules that -- on paper -- allow Medicare savings spent for another purpose to also be credited to the program's trust fund for inpatient care. Obama's health care law used Medicare cuts to pay for covering the uninsured; the Ryan budgets passed by the House kept those cuts and applied them to reducing the federal deficit.