WASHINGTON — With the presidential campaign in full swing, a new government report on a big national problem is usually followed by volleys of rhetoric from the candidates. But Tuesday, when the annual report on the state of Medicare and Social Security came out, the reaction was not exactly deafening.
The two programs on which millions of elderly Americans depend are apparently just too hot to handle — especially since any realistic solution probably would involve a politically unpalatable combination of higher taxes and lower benefits.
As a result, Arizona Sen. John McCain, the presumed Republican presidential nominee, had little to say when the latest numbers were released Tuesday projecting Medicare going into the red by 2019 and Social Security following in 2041. The Democratic contenders, Sen. Barack Obama of Illinois and Sen. Hillary Rodham Clinton of New York, also sidestepped the issue.
Baby boomers will start retiring and signing up for Medicare in 2011 — during the next president’s first term. And the program faces rapidly rising health care costs and an aging society. Indeed, the trustees’ report released Tuesday showed that Medicare spending will surpass Social Security in 2028 and grow to almost double the cost of the pension program in 2082.
Of the three candidates, McCain is running as the most fiscally conservative. He criticized the Medicare prescription benefit when it was created in 2003, saying that Congress and President Bush failed to provide for the long-term cost.
McCain has called benefit programs “unsustainable” and promised to work with Democrats to find solutions. But he has not laid out his own ideas in detail. And he certainly has not indicated a willingness to consider tax increases.
The candidates agree that Medicare’s problems are part of the larger concern of rising health care costs, and they have similar kinds of proposals to try to rein them in without tax increases or benefit cuts.
These include better coordination of care for the chronically ill, paying doctors and hospitals for quality instead of volume of services, reducing prescription drug costs and emphasizing preventive health care. But the savings from those changes, of whatever size they turn out to be, might take a decade or more to start showing up in a significant way — and Medicare’s problems appear to be more pressing.
Democrats say there is still plenty of time to prevent catastrophic disruptions. Even if program trust funds become insolvent, they say, annual payroll tax receipts would suffice to cover more than three-fourths of the costs of providing benefits.
But if McCain steers away from the issue of taxes, Clinton and Obama avoid discussing benefit cuts. They also oppose creating private accounts in Social Security, as Bush — with McCain’s support — tried to do in 2005.
Congress is expected to produce a Medicare bill this year to forestall a programmed cut in payments to doctors, but few expect progress on the underlying problems. Health and Human Services Secretary Michael Leavitt reflected a widespread sense of frustration as he joined in presenting the Social Security and Medicare reports.
“Americans’ sensitivity to entitlement warnings has become numbed by a repeated cycle of alarms and inaction,” he said. “We noted today in Washington that the cherry blossoms are out. That’s the way spring is in Washington. We see the cherry blossoms and hear Medicare warnings. The cherry blossoms go away, and nothing happens with Medicare.”
