Tommy and Medicare…2008 – 2012 – From “Death Panels” to “Death to the system”

Two videos, four years apart illustrate a dramatic departure from political and economic reality for Tommy Thompson. In a recent speech in front of the “Lake Country Defenders of Liberty”  at Olympia Resort and Conference Center (Oconomowoc), Thompson laid out the plan to end Medicare. Four years earlier, in an October 2008 online interview, Thompson supported a commission to reform end-of-life treatment limitations as a way to help save Medicare. This extreme ideological shift begs the question – is Thompson even capable of independent thought and responsible governance anymore?

In the recent speech, Thompson outlines the textbook neo-conservative methodology for killing a government program . In the words of Grover Norquist:

I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub.

Thompson asks “…who better than me, I already finished one program, Welfare, to do away with Medicaid and Medicare?” His answer follows the Norquist blueprint. “Give people a choice,” says Thompson, between taking the current government-run Medicare or purchasing their own insurance with a subsidized voucher.

Thompson continued the attack, “…no one will accept it (the current plan), because Medicare will be broke by 2022.” The same strategy is being used to weaken public pension plans. As more people “opt out” the participant pool diminishes. Revenue going into the program decreases to the point that it becomes incapable of paying out current benefits. It can then be “drowned in the bathtub.”

Aside from the ideology over economics, Thompson’s claim requires a fact and reality check. The Thompson claim that “Medicare will be broke by 2022″ is inaccurate. Further, the voucher policy he supports, coupled with the repeal of the Affordable Care Act (Thompson has stated his support for repeal) would make Medicare even less stable.

According to the Medicare Trustees’ report from this year:

“The Medicare Trustees Report shows that the Hospital Insurance (HI) Trust Fund is expected to remain solvent until 2024, the same as last year’s estimate…The ACA is giving the CMS the ability to do this work, with tools to lower costs, fight fraud and change incentives so that Medicare pays for coordinated, quality care, not the number of services…without the Affordable Care Act, the HI Trust Fund would expire 8 years earlier, in 2016.

Much of the neo-conservative propaganda about Medicare and the ACA being touted by Thompson et al, comes from an independent paper published by a Public Medicare Trustee  Charles Blahous.

To ensure the ACA does not worsen the federal fiscal outlook, fully two-thirds of the ACA’s new health-exchange subsidies must be repealed, or financing offsets must be found before 2014…the ACA will add some $530 billion to federal deficits by 2021 and that the Obama administration employs “double counting” in its savings estimates.

Blahous is a “Senior Research Fellow” at the Mercatus Institute - funded by Charles and David Koch. The Blahous paper has been skewered by more rational minds, namely Jonathan Chait and Paul Krugman. From Chait:

You may wonder what methods Blahous used to obtain a more accurate measure of the bill’s cost. The answer is that he relies on a simple conceptual trick. Medicare Part A has a trust fund. By law, the trust fund can’t spend more than it takes in. So Blahous assumes that, when the trust fund reaches its expiration, it would automatically cut benefits.

The assumption is important because it forms the baseline against which he measures Obama’s health-care law. He’s assuming that Medicare’s deficits will automatically go away. Therefore, the roughly $500 billion in Medicare savings that Obama used to help cover the uninsured is money that Blahous assumes the government wouldn’t have spent anyway. Without the health-care law, in other words, we would have had Medicare cuts but no new spending on the uninsured. Now we have the Medicare cuts and new spending on the uninsured. Therefore, the new spending in the law counts toward increasing the deficit, but the spending cuts don’t count toward reducing it.

Krugman illustrates this accounting absurdity using a budgetary example relative to the Bush Tax Cuts:

“…the whole of the Bush tax cuts will expire at the end of this year. If that’s your baseline, then plans like the Ryan budget, which not only maintains those tax cuts but adds another $4.6 trillion to the pot, are wildly deficit-increasing — in fact, the Ryan plan would be a huge budget-buster even if hell freezes over and his secret loophole-closers turn out to be real.”

The absurdity of this accounting of Medicare persists with far right-wing GOP candidates – including Thompson. The reason is obvious – it creates panic and confusion about fiscal reality. In fact, it is now replacing fiscal reality with ideology. The proof is Tommy Thompson in 2008 talking about how to save Medicare.  

Thompson’s ideas to reform (not kill) Medicare:

1.  “I would put a Medicare base closing commission together which is going to make the tough decisions such as age, such as taxes, such as when you’re on your death-bed, what sort of treatments do you get, and when you get in the last 12 months of your life where 30% of the cost of Medicare dollars are expended.”

2.”The second thing you have to do is you have to fix SCHIP. This is the program for poor children and you got to be able to put together a bipartisan support on SCHIP and I think that’s imminently doable.”

3. “…the third thing you have to do is you have to fix what we call the reimbursement formula for doctors. It has been postponed now for five years, and every year that it’s postponed, it’s causing more money and that’s got to be fixed.”

4. “…we got to do something about Information Technology and have national standards for an electronic medical record and put the cost to credits in there that’s going to be the inducement for doctors to use electronic medical records and actually prescribe using a computer instead of handwriting.”

5. “…we really educate America to eat properly, exercise and take care of themselves and that’s where chronic illnesses come in, because most of chronic illnesses are either self-inflicted or exaggerated and exacerbated by what we do, what we put into our bodies and our failure to exercise”

 Who was that Tommy Thompson? Such is the influence of corporate money and influence on politics. Merely four years ago, Thompson was talking of bi-partisan reform, and was even in support of what has now been demonized as “death panels” to reform end-of-life care treatments.

Today, Thompson has become an ideologue, putting the corporate takeover of democracy over responsible governance.

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