Entitlements, such as Medicare and Social Security, are a growing portion of the U.S. long-term debt. Many analysts says unless the entitlements system is reformed the national debt will become unsustainable. In a speech to the Detroit Economic Club, GOP presidential candidate Mitt Romney proposed raising the eligibility age for Medicare (AP) and eventually tying the eligible age to life expectancy. “With these commonsense changes, we will have fixed our balance sheet,” Romney said.
At a GOP debate last week, Rick Santorum said it was necessary to deal with Medicare now, “not 10 years from now…because our country is facing fiscal bankruptcy.” Ron Paul, who was a practicing physician for many years, has criticized federal involvement in health care. “Probably the worst thing that we ever did was make medical care the responsibility of the government,” he said. If elected president, Paul said he would not immediately cut health care benefits, especially for the elderly and children, but rather transition out of the current system by allowing people to set up personal medical savings accounts.
Newt Gingrich, who has been harshly critical of Medicare, last December praised a bipartisan Medicare premium support plan by Orego0n Democratic Sen. Ron Wyden and GOP Wisconsin Rep. Paul Ryan. The plan would provide seniors with pre-determined premium support vouchers to purchase benefits through an exchange of private plans or the existing fee-for-service program.
President Obama’s 2013 fiscal budget, meanwhile, would cut payments to Medicare providers (TheHill) by $267 billion over the next decade.
To see more about the candidates’ positions check out CFR’s Issue Tracker on the Economy.
Suggested Other Reading:
CFR’s Michael Hodin says the path to fiscal sustainability for Medicare lies in funding research programs and healthy aging initiatives that reduce the government outlays needed to care for an aging population.
Brookings Institution’s Ron Haskins writes that the next president must work with Congress to solve the United States’ deficit crisis by reducing spending, especially on Medicare, and increasing taxes.
–Contributing Editor Liriel Higa