Republicans complained for years about the Medicare cuts imposed by Obamacare, but are not looking to restore those cuts in legislation that aims to undo the law.
The repeal-and-replace bill that House GOP leaders are trying to pass in the next few weeks leaves in place major cuts to Medicare, which were an important way the Affordable Care Act paid for its subsidies and extra Medicaid spending.
Republicans could restore those cuts in the budget reconciliation vehicle they’re using to repeal and replace the healthcare law. But doing so would be massively expensive, and they’ve already struggled to write the plan in a way that doesn’t increase deficit spending.
Republicans typically welcome the opportunity to cut government spending, and some say it odd that they used Obamacare’s Medicare cuts as a top line of attack.
“That was just political rhetoric,” said Bob Berenson, a fellow at the Urban Institute, who has watched the Obamacare political wars play out for years. “They picked that argument, but they never seriously wanted to repeal the cuts.”
But candidates on the right, and conservative groups trying to get them elected so they could help repeal the healthcare law, spent a lot of time, money and effort advancing that political rhetoric in the 2010, 2012 and 2014 election seasons.
During just one month leading up to the November 2012 election, groups including the American Action Network, American Crossroads, Americans for Tax Reform and the U.S. Chamber of Commerce spent about $8 million on ads specifically attacking the Medicare cuts, according to data from Kantar Media.
In a 2011 Republican presidential debate, former Rep. Michelle Bachmann said former President Barack Obama “stole” from Medicare to fund the law. “We know that President Obama stole over $500 billion out of Medicare to switch it over to Obamacare,” she said.
The Republican Party’s 2012 presidential nominee, Mitt Romney, echoed that claim, telling CBS that Obama “robbed” from Medicare to pay for his healthcare law.
The line became a favorite attack point for multiple other conservative politicians and groups trying to score political points against a law that was relatively unpopular. Six House Republican leaders, including now Majority Leader Kevin McCarthy, wrote to Obama in 2014 to complain about how the cuts might impact seniors’ benefits.
“These cuts … will force millions of American seniors to face higher healthcare costs or lose access to their doctor, health plan, lifesaving drugs and the benefits they’ve come to rely on,” they wrote.
Republicans were right about one thing: The healthcare law did pull down Medicare spending significantly, by a little more than $500 billion over a decade. It achieved the spending reductions in several ways, including through lowering payment rates to private Medicare Advantage plans and reducing annual payment updates to hospitals.
The cuts, paired with some new taxes on insurers and health providers, allowed Democrats to pass a health reform bill deemed by the Congressional Budget Office to save money in the long run — a big win for them at the time.
Now that they have a presidential ally in Donald Trump, Republicans are trying to replace the healthcare law with a bill that repeals most of its taxes but continues subsidies for the low-income, making the Medicare savings crucial to achieving a positive score from the CBO.
And now that the law has been in place for seven years, restoring the funding would cost even more, since the cuts caused Medicare spending to grow more slowly. Repealing the Medicare cuts would cost $879 billion over the next decade, the CBO wrote in a June 2015 analysis.
“The score would be astronomical, there’s just no way they could do that,” Berenson said.
Still, if Republicans restored the cuts it could help to win over hospitals and other healthcare providers who have expressed deep hesitation about their bill, dubbed the American Health Care Act. The Federation of American Hospitals asked Congress to do just that, in a March 7 letter to members.
“These cuts are tantamount to the taxes that the [American Health Care Act] fully eliminates, and should be treated in a like manner since they were both imposed for the sole purpose of funding a coverage expansion,” the hospital group wrote.
