WASHINGTON -- President Obama laid out a budget proposal Wednesday that included cuts of nearly $500 billion to the Medicare and Medicaid programs over the next 12 years, along with a stronger role for the new independent panel tasked with keeping an eye on cost increases.

In a speech at George Washington University, the president outlined his plan to reduce the budget deficit by $4 trillion in the next 12 years, including savings of $480 billion from the Medicare and Medicaid programs by 2023, and another $1 trillion of savings in those programs by 2033.

However, he added: "Let me be absolutely clear: I will preserve these healthcare programs as a promise we make to each other in this society. I will not allow Medicare to become a voucher program that leaves seniors at the mercy of the insurance industry, with a shrinking benefit to pay for rising costs."

Obama was referring to a proposal by congressional Republicans to turn Medicare into a "premium support" program, in which Medicare beneficiaries would choose from a variety of private insurance programs, and the government would pay a set amount of premium funds to the beneficiary's chosen insurer while the beneficiary would have to pay the rest of the premium.

According to materials provided by the White House, the healthcare aspects of the president's plan would fall into four major areas.

Holding down the growth in per-beneficiary Medicare costs. This would be achieved by strengthening the power of the Independent Payment Advisory Board (IPAB), which was created under the Affordable Care Act to advise Congress on Medicare payment issues.

If Medicare growth per beneficiary were to exceed the per-capita Gross Domestic Product plus 1%, the IPAB would recommend to Congress policies to reduce the rate of growth to meet that target without harming beneficiaries' access to needed services.

Congress would then have to consider IPAB's recommendations and, if it disagreed, enact policies that achieved equivalent savings.

If neither the IPAB nor Congress were to act, then the Secretary of Health and Human Services would have to develop and implement a proposal to achieve the savings target.

Reforming the Medicaid program. "Under current law, states face a patchwork of different federal payment contributions for Medicaid and the Children's Health Insurance Program (CHIP)," the White House noted. "The president's framework would replace the current complicated federal matching formulas with a single matching rate for all program spending that rewards states for efficiency and automatically increases if a recession forces enrollment and state costs to rise."

Cutting unnecessary prescription drug spending. The plan would "limit excessive payments for prescription drugs by leveraging Medicare's purchasing power," according to the White House.

The plan also calls for speeding up the availability of generic biologics, and prevents brand-name drugmakers from signing "pay for delay" agreements to make generic manufacturers wait longer before putting out a generic version of a brand-name drug.

Also, the plan would implement "Medicaid management" of high prescribers and users of prescription drugs.

Reducing abuse and increasing accountability in Medicaid and Medicare. This would be done through recovering erroneous payments made to providers in the Medicare Advantage program, putting ceilings on Medicaid payments for durable medical equipment, and other moves to prevent waste, fraud, and abuse.

The president's plan also would "make Medicaid more flexible, efficient and accountable without resorting to block granting the program, ending our partnership with states, or reducing healthcare coverage for seniors in nursing homes, the most economically vulnerable, and people with disabilities," according to the White House.

No further details were provided, but the White House estimated combined savings in the Medicaid program of at least $100 billion over 10 years.

Throughout his address, the president contrasted his plan with the Republicans' approach.

He noted that under the Republican plan, "10 years from now, if you're a 65-year-old who's eligible for Medicare, you should have to pay nearly $6,400 more than you would today. It says instead of guaranteed healthcare, you will get a voucher. And if that voucher isn't worth enough to buy the insurance that's available in the open marketplace, tough luck -- you're on your own."

At the same time, the Republicans want to give wealthy Americans a tax break, Obama continued. "They want to give people like me a $200,000 tax cut that's paid for by asking 33 seniors to each pay $6,000 more in health costs. That's not right, and it's not going to happen as long as I'm president."

Many of the ideas in the proposal the president put forth today are similar to those proposed by the bipartisan deficit reduction commission he appointed early in 2010.

That commission also called for eliminating the Sustainable Growth Rate formula that determines physician Medicare payments in 2015 and replacing it with a "modest reduction" in payments.