Medicare, the opera
Another election, another nonsensical fight over the elderly
APRIL has been a cheerful month for the Affordable Care Act, better known as Obamacare.
More than 7m Americans have signed up for private coverage through the law's exchanges and, by the end of February,
more than 3m people had enrolled in Medicaid, the health programme for the poor.
According to the latest Gallup poll, America's share of uninsured has fallen to its lowest level since 2008.
These figures are good news for anyone keen to expand health coverage. They may not be so helpful for the Democrats' election prospects.
To understand why, consider another set of figures. More than 40m older Americans are enrolled in Medicare,
the public-health programme for those aged 65 and older, with more than 15m of them in private Medicare plans.
These are reliable voters in elections. And Republicans are singing them the same aria again and again:
Democrats are raiding their benefits to pay for Obamacare.
Democratic politicians are desperate to convince them otherwise.
On April 7th health officials provided some help: after proposing in February to cut payments to private Medicare plans by 1.9%,
the Centres for Medicare and Medicaid Services (CMS) said they would rise slightly instead. This will not quiet Republicans.
Obamacare does indeed lower Medicare spending by $716 billion from 2013 to 2022.
Of this, $156 billion comes from Medicare Advantage, which lets the elderly use public money to buy private health plans.
For years the government has paid more for these private plans, per person, than for traditional Medicare.
Private insurers passed along the extra subsidy to consumers in the form of additional benefits or lower fees.
Obamacare sought to bring private payments in line with traditional Medicare.
This was not a radical idea, but it is politically controversial nevertheless.
Medicare Advantage is increasingly popular—about three in ten Medicare beneficiaries are enrolled in a private plan.
Insurers argue that Obamacare's cuts, combined with other measures, will force them to raise prices or cut benefits.
Last month's special election in Florida was a cautionary tale for Democrats.
“To pay for Obamacare, Washington is forcing seniors to endure deep cuts to Medicare Advantage,” purred an advertisement.
“Sadly, Alex Sink supports these cuts.” Ms Sink lost her campaign.
Not surprisingly, Republicans as well as many anxious Democrats implored CMS not to lower payments.
In February 40 senators wrote to CMS to ask as much. On April 3rd 29 congressional Democrats and Republicans sent their own letter.
In the end CMS said it would raise payments by 0.4%. The true effect on Medicare Advantage is more complex.
America's Health Insurance Plans, the industry group that had lobbied against cuts,
maintains that CMS's changes still amount to lower payments.
Ana Gupte of Leerink Swann, an investment bank, points out that delaying cuts now may mean a bigger cut next year.
The ruckus belies a simple fact. Both Democrats and Republicans agree that Medicare spending must be contained.
The budget proposed by congressional Republicans, written by Paul Ryan,
would preserve all Obamacare's cuts to Medicare, including those to Medicare Advantage.
Just don't expect Republicans to mention that on the campaign trail.