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Barack Obama signing Affordable Care Act
President Obama signing the Affordable Care Act, extending the life of Medicare.
Mitt Romney has a problem with his promise to "restore" the $716 billion in cuts the Affordable Care Act made to providers in Medicare. He loses those cuts, and the Medicare trust fund could go bankrupt by the end of his first term, barring other, massive cuts or tax hikes.

That's because the cuts that the ACA included are working to make Medicare stronger. Here's analysis from the Center on Budget and Policy Priorities. Bottom line, that $716 billion is what is saved in Medicare.

Chart showing savings in Medicare hospital insurance program in ACA reforms.
The Congressional Budget Office estimates that the ACA will reduce Medicare’s projected spending by $716 billion over the 2013-2023 period.  As John McDonough of Harvard’s School of Public Health explains: “None of these reductions were financed by cuts to Medicare enrollees’ eligibility or benefits; benefits were improved in the ACA. Cuts were focused on hospitals, health insurers, home health, and other providers.”

Medicare’s trustees confirm that health reform has improved the program’s finances: “The financial status of the HI [Hospital Insurance] trust fund was substantially improved by the lower expenditures and additional tax revenues instituted by the Affordable Care Act.”  (See page 4 here.)

That chart demonstrates how the Medicare fund is shored up by the ACA reforms. The shortfall in the Medicare hospital insurance program has been reduced to nearly a third what it was before the ACA reforms over the next 75 years. It will be able to pay 100 percent of the costs of the hospital insurance coverage that Medicare provides through 2024. That makes it solvent through 2024. If, as Romney proposes, the reforms are reversed, the hospital insurance program would be bankrupt by the end of his term, in 2016.

That is, unless Romney did something really drastic with the financing to come up with another $716 billion. His choices are other cuts to providers, raising taxes, or cutting benefits. It's damned hard to imagine a President Romney doing either of the first two options. He's already on board with the benefits cuts that Ryan's coupon plan promises, so who would get to make up that shortfall? And it would hit in his term, for current seniors, not in the future.

The Medicare cuts in Obamacare don't cut seniors' benefits, now or in the future. The Romney/Ryan voucher plan does. Obamacare extends the life of Medicare, Romney/Ryan will force it to wither on the vine. It really is that simple with this one.

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