NITA LOWEY FOR CONGRESS

Obama’s challenge: Keep Pelosi on his side
By Matt DoBias
July 8, 2011

President Barack Obama has a big problem as he heads into Sunday's budget talks: His biggest ally on health care reform is now his most outspoken critic on Medicare and Medicaid cuts.

On Friday, House Minority Leader Nancy Pelosi said her party would be open to Medicare, Medicaid and Social Security alterations, but only if the savings flow back into those programs as a way to steel them financially for the future.

The former House speaker also hinted that Democrats could show some give on provisions that effectively recalculate Social Security benefits as long as they are phased in and protect seniors already in the program.

Pelosi said she outlined her party’s wishes during a Friday morning meeting with Obama and Vice President Joe Biden. They’re sure to be on Obama’s mind as he begins the next round of talks with Speaker John Boehner, Pelosi, and other congressional leaders from both parties Sunday.

Pelosi’s comments shed light on the difficult choices Democrats face as they negotiate a multitrillion dollar deal to steady the nation’s economy. They also underscore that any bargain struck by Obama and congressional leaders hinges not only on old-fashioned politicking but also on semantic twists.
“Cutting benefits is exactly that — cutting benefits,” Pelosi told reporters. She and other Democrats have repeatedly said they would not support spending reductions to entitlement programs that result in a loss of benefits to seniors.

But the definition may not be so clear. Several proposals now being discussed could lower Social Security payments or otherwise put the squeeze on Medicare and Medicaid in such a way that seniors feel the pinch in their wallets.

Democrats and Republicans alike have pitched an initiative to change how the inflationary updates are calculated in Social Security that would work to lower payments annually in the program.

Another measure being discussed could require Medicare to charge a co-pay for home health services. Home health visits traditionally have been free to seniors, but under one option being discussed, beneficiaries would be required to pay a small amount out of pocket.

Combined, those measures could make it more difficult to win Democratic votes. At the very least, the prospect has caused lawmakers no small amount of anxiety.

Still, other measures that are being mulled include a number of ways to eke out savings in those massive entitlement programs. One provision requires pharmaceutical companies to pay Medicare a rebate on certain prescription drugs. Doing so could save the program nearly $150 billion.

“That’s not a benefit cut, it’s a cost savings to Medicare,” Pelosi said. “If that were to be part of the grand plan, we want to make sure that money is put back into Medicare.”
Even if Pelosi ends up satisfied with a deal, it could prove a tough sell to her rank-and-file members.

Many Democrats still feel the sting from an earlier round of budget talks that seemingly favored GOP initiatives. It was in those rounds of negotiations, on the spending package that funds the government for the rest of the fiscal year, that Republicans landed some glancing blows to Obama’s health reform package.

Those memories are clearly still fresh in the minds of Democrats as the deficit reduction talks continue over the weekend.

“We’re Democrats,” New York Rep. Nita Lowey said as she emerged from an afternoon caucus meeting. “We cannot cut Social Security, we cannot cut Medicare and we cannot cut Medicaid.”
Lowey said House Democrats are unified in their opposition.

“Right now you cannot put various proposals on the table that are going to mean cuts to seniors,” she added.