July 22, 2011
That is what Republicans say. Officials, like the Medicare Trustees, say that the program faces a modest shortfall over its 75-year planning horizon. The projected shortfall is around 0.3 percent of GDP or less than one-fifth of the amount that we increased annual military spending by since September 11th. The projected Medicare shortfall is down by more than 75 percent from when President Obama took office due to the cost controls put in place in the health care reform bill.
In fact, the Congressional Budget Office (CBO) calculates that the Medicare system in its current form is far more efficient than the privatized system advocated by Republicans. CBO’s projections imply that switching to a privatized system would add $34 trillion to the cost of buying Medicare equivalent policies over the program’s 75-year planning period.
This piece also reports that Senator Coburn of Oklahoma wants to reduce the annual cost of living adjustment (COLA) to Social Security to make it more accurate. It is worth mentioning that Senator Coburn is not interested in having the Bureau of Labor Statistics construct an index that actually measures the cost of living of the elderly so that it could in fact be made more accurate. He is instead insisting that Social Security COLAs be based on an index that is known to show a lower rate of inflation.
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