Mitt Romney and Paul Ryan wanted to turn Medicare into private plans, but it's not likely. GOP ready for any entitlements win

The script for a fiscal cliff deal was always supposed to be simple: Democrats would win on taxes. Republicans would win on entitlements.

But what kind of victory can Republicans really hope to win? They’re going to have to lower their sights — by a lot — from the big ideas they pushed in the presidential campaign.


Mitt Romney and Paul Ryan wanted to turn Medicare into a competition between private plans. They wanted to scale back Medicaid, and turn it into block grants for states.

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Nothing like that is remotely likely now. With Obama in the White House for another four years, Republicans are looking for something much smaller, even a down payment on Medicare, that they can still call a victory.

And even that scaled back agenda carries the risk that they’ll become the party that owns Medicare cuts — a policy victory, but a political loss.

For Democrats, it’s easy to see what victory means: getting Republicans to raise taxes on the rich. For Republicans, it’s less dramatic. The outer edge of what they could get from Obama would be an increase in the Medicare eligibility age from 65 to 67 — maybe with some expanded means-testing of Medicare premiums for the wealthy. (There’s already some of that in Obama’s own health care reform law and in the 2003 law that created the Medicare prescription drug program.)

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Would those changes be enough to allow Republicans to claim victory? Sure, Republican operatives and conservative analysts are saying — because they’ll have to be.

“They’re not as significant as I would like them to be, but they’d be a reasonable step along the right path. They might set in motion a dynamic where you could get both parties to do more later on,” said Peter Wehner, a former adviser to President George W. Bush who’s now a senior fellow at the Ethics and Public Policy Center.

Charlie Black, a Republican strategist and former adviser to Sen. John McCain, argued that “what our guys are focused on is making some progress in not continuing to run up the debt by trillions of dollars.”

But are the most realistic Medicare changes in the fiscal cliff scenario what Republicans had in mind? Not even close. And right now, they’re not rushing out to make the case that the GOP is on the verge of a big win.

“These are all good ideas … but they’re not transformational. You just can’t say, ‘Whew, we fixed it for the next generation.’ You just can’t say that,” said Douglas Holtz-Eakin, president of the American Action Forum and another former McCain adviser.

“You wanted steak, and you ended up with reheated hamburger,” Holtz-Eakin added.

So what’s the best thing to do with reheated hamburger? Prepare your base by lowering the expectations.

Republican leaders are insisting — loudly — that Obama just doesn’t want to do anything on entitlements. House Speaker John Boehner charged Friday that even if the GOP caved on tax rates, “we would continue to see trillion-dollar deficits for as far as the eye can see.” It’s Obama’s turn, Boehner said, to make a counteroffer.

“Republicans, for more than a year, have been very clear about the type of balanced approach that could get to an agreement that would significantly reduce the deficit. The White House only cares about [tax] rates,” said one Senate Republican leadership aide. “I’m pessimistic that they’re willing to do anything.”

All of which sets the stage for just about any entitlement cuts to look like a win — even if it falls way short of the GOP’s past ambitions.

It also may help Republicans that House Minority Leader Nancy Pelosi has come out against raising the Medicare eligibility age, saying it wouldn’t bring in enough savings and is “not even the right thing to do.” What better way to claim victory if Obama actually gives them the age change that Pelosi didn’t want?

But how do Republicans reverse course after spending the whole campaign season hitting Obama over those $716 billion in Medicare cuts?

Democratic Hill aides say there’s a basic disconnect because Republicans have always insisted on entitlement “cuts” in the deficit reduction talks — and that just squeezing out inefficient payments have never been enough for them.

But Republicans, and conservative thinkers who supply ideas on entitlement reform, say they’ve always wanted to make basic changes in the health programs to make them more sustainable — not just pay doctors and private health plans less, the way Obama’s health care law does.

“On Medicare, there’s no limit to how much they’ll cut reimbursements,” said Mike Franc, vice president of government studies at The Heritage Foundation.

Republicans want to be able to say they changed Medicare to better target benefits, and give less help to the people who don’t need it. That’s why they say they’d be happy with an increase in the Medicare eligibility age, to modernize a program where “the age is based on 1950s life expectancy,” and to expand the means-testing so wealthy seniors pay more, Franc said.

But there’s also a sense in GOP circles that Republicans may have some breathing room on Medicare, because they didn’t actually do too badly with voters with the much more sweeping Medicare changes Romney and Ryan proposed — certainly not as badly as Democrats thought they would.

“The one thing where the Democrats thought they could gain an advantage was by attacking the Ryan budget, and it didn’t have an impact,” said GOP pollster David Winston, who advises the House Republican leadership.

In a Wall Street Journal op-ed last month called “The Death of ‘Mediscare,’” Wehner and Republican strategist Dan Senor, both of whom advised the Romney campaign, noted that Romney and Ryan carried voters age 65 and older by 17 percentage points — and won among voters age 45 to 64 — despite all of Obama’s attacks on their Medicare plan.

And Winston noted that the exit polls found that, by an 8-point margin, voters said government was doing too many things that are better left to businesses and individuals — a reversal from 2008, when the smaller-government question lost by the same margin.

“The sense that, ‘look, we need to cut spending,’ I don’t think there’s any question that people are behind that,” Winston said. “Now obviously, the scale of that is what you have to work through, and that’s what they’re in the process of working through.”

But other polls show the very real political risk in the specific concessions the Republicans might get on entitlements. A Washington Post-ABC News poll found that 67 percent of all Americans oppose raising the Medicare eligibility age, while just 30 percent support it.

The reality, though, is that Republicans need some tradeoff on entitlements to justify raising tax rates, and the Medicare eligibility age — whatever Pelosi thinks of it — is something Obama has put on the table before, during “grand bargain” talks with Boehner in 2011. And Democrats could justify more means-testing of Medicare premiums. Even the chair of the Congressional Black Caucus, Rep. Emanuel Cleaver, said on Friday that means testing is preferable to a lot of alternative ways of cutting.

And there’s no question on whom the public will blame if there’s no fiscal cliff deal at all. In a poll Tuesday by the Pew Research Center for the People and the Press, 53 percent of Americans said Republicans would get the blame — and just 27 percent said Obama.

“I think you’d be able to say that this is a step — that [Medicare] means-testing is a reasonable step, that the eligibility age is long overdue at a time of longer life expectancies,” said Wehner. Then, he said, Republicans would have to say they didn’t push for more because “we’re trying to be responsible” rather than forcing the nation over the fiscal cliff.

“That’s essentially the tone you’d have to take. I don’t think you could be triumphal about it,” he said.

Jennifer Haberkorn contributed to this report.

This article first appeared on POLITICO Pro at 10:17 a.m. on December 8, 2012.