Policy-ish

Does President Obama Really Want To Means-Test Medicare? Probably Not

President Obama (and many, many others) have been throwing around the phrase "means testing" as they talk about ways to cut spending for Medicare.

"You keep using that word. I do not think it means what you think it means," says Inigo Montoya, Mandy Patinkin's character in one of the many now-famous lines in the movie The Princess Bride.

Of course he wasn't responding to the President, but he could have been.

Here's what Mr. Obama said at his news conference earlier today when a reporter asked if he "would be willing to means test" Social Security or Medicare:

"I've said that means testing on Medicare, meaning people like myself, if — I'm going to be turning 50 in a week. So I'm starting to think a little bit more about Medicare eligibility. Yes, I'm going to get my AARP card soon — and the discounts. But you can envision a situation where for somebody in my position, me, having to pay a little bit more on premiums or co-pays or things like that would be appropriate. And, again, that could make a difference. So we've been very clear about where we're willing to go."

The Merriam-Webster dictionary defines means test as "an examination into the financial state of a person to determine eligibility for public assistance."

In other words, a means test is a test to determine whether you get a particular benefit, not how much you pay for it. Medicaid is a means-tested program. So are Food Stamps.

If Medicare actually was means-tested, then wealthier people wouldn't get the benefit at all.

The context of the President's comments make it fairly clear that he's talking about something else entirely. It's called "income relating." That's when people with higher incomes pay more but get the same benefits as people who earn less.

Medicare currently has income-related premiums for Part B of the program and, under last year's Affordable Care Act, will begin income-relating premiums for Medicare's prescription drug program this year.

So can we stop talking about means-testing Medicare (and Social Security for that matter) and start talking calling it what it really is — charging people more for benefits when they have higher incomes?

Probably not. As another Princess Bride character says, that just might be "inconceivable."

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