In his weekly address Saturday, President Obama touted the report issued at the end of last week from the Medicare Trustees. He bragged, “According to this report, the steps we took this year to reform the health care system have put Medicare on a sounder financial footing.  Reform has actually added at least a dozen years to the solvency of Medicare – the single longest extension in history – while helping to preserve Medicare for generations to come.”

But a must-read Wall Street Journal editorial pointed out yesterday, “One problem: That spin ignores the extraordinary companion analysis by chief Medicare actuary Richard Foster that repudiates this conclusion and is the most damning fiscal indictment to date of the Affordable Care Act. . . . [A]s he notes in his appendix, the law as written bears little if any relation to the real world—and thus, he says, the trustee estimates ‘do not represent a reasonable expectation for actual program operations in either the short range . . . or the long range.’ In an unprecedented move, he directs readers to a separate ‘alternative scenario’ that his office drew up using more realistic assumptions. Mr. Foster shows that the Medicare ‘cuts’ that Democrats wrote into ObamaCare exist only on paper and were written so they could pretend to reduce the deficit and perform the miracles the trustees dutifully outlined. With the exception of cuts in Medicare Advantage, those reductions will never happen in practice.”

Even the AP wrote last week, “[D]espite assertions to the contrary by the Obama administration, the new health care law doesn’t improve Medicare’s solvency by much.” That AP story also noted the administration’s double-counting of their Medicare cuts that was highlighted in an April report from Foster’s office. “An April 22 analysis pointed out that the highly touted gain of 12 years of additional solvency for Medicare from the health overhaul is largely an ‘appearance,’ stemming from how Medicare cuts are handled under federal accounting rules. Savings from those cuts would be used to finance coverage for the uninsured. ‘In practice, the improved (Medicare) financing cannot be simultaneously used to finance other federal outlays (such as the coverage expansions) and to extend the trust fund, despite the appearance of this result from the respective accounting conventions,’ the report said.”

As the WSJ explained yesterday, “[T]his is a strange excuse for celebration. Democrats wrung about a half-trillion dollars from Medicare over the next decade, but then they turned around and plowed these ‘savings’ into their new middle-class health-care entitlement. It’s akin to paying off one credit card with another—while still being deeply in hock on the first.”

Republicans warned throughout the health care debate that the saving Democrats were claiming for their bill was mostly the product of spin and accounting gimmicks, and subsequent news reports and various analyses have shown the GOP was right all along. Taking $500 billion from Medicare, spending it on a new entitlement, and then bragging about how that constitutes “savings” is not the reform Americans were looking for. This bill needs to be repealed and replaced.

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