Republicans revisit Medicare reform to cut spending

WASHINGTON — Fired up as once-unimaginable spending cuts start to slice the federal budget, Republicans are launching a new phase in their austerity campaign — resurrecting the party’s cost-cutting plan to turn Medicare into a voucher-like system for future seniors.

Despite public uncertainty Saturday about the $85 billion in so-called sequester cuts, Republicans now believe they have momentum to ask Americans to make tough choices on Medicare, as rising healthcare costs combine with an aging population to form a growing part of future deficits.

That effort will form the backdrop as the White House and congressional Republicans enter their next round in the budget wars — keeping the government funded through Sept. 30. Unless they make a deal by March 27, the government could run out of money and be forced to shutter offices and curtail services.

President Obama and Republican leaders have signaled that they are eager to avoid another bruising battle and federal shutdown as both sides position themselves for the next major pressure point, in late spring or early summer, when the government faces a potential debt default.

Rep. Paul D. Ryan of Wisconsin, the former Republican vice presidential nominee, is preparing a budget blueprint that aims to balance revenue and spending in 10 years. But his effort has run afoul of the GOP vow not to change Medicare — the federal healthcare program for seniors and the disabled — for those now 55 or older.

Medicare eligibility currently begins at age 65. Ryan’s approach would transform the benefits program into one that would provide a fixed amount of money in a voucher that future seniors could apply to the cost of buying private health insurance or to buying coverage through traditional Medicare.

Throughout last year’s presidential campaign, the GOP promised not to change Medicare for today’s seniors — only the next generation. But Republicans familiar with the number-crunching in Ryan’s budget committee say balancing the budget may not be possible unless the changes start for those who are now 56 and younger.

Critics say Ryan’s plan would shift healthcare costs from the government and onto seniors. Democrats who sharply criticized Ryan’s proposal during the 2012 campaign say voters rejected his arguments when they reelected Obama.

Even some Republicans who support Ryan’s proposal are wary.

“Is it going to be difficult? It’s the third rail. Sparks are coming off before you even touch it,” said Rep. Tim Walberg (R-Mich.) as he showed a photo of his grandchildren on his smartphone last week. “I want them to say: Grandpa tried.”

Ryan’s budget proposal is expected to lock in $1.2 trillion in sequestration-linked cuts over the next decade, while also reducing growth in the costs of Medicare and Medicaid — the health program for the poor, disabled and seniors in nursing homes. Other safety net programs, including food stamps and school lunches, also would be targeted.

Some budget experts, including Republicans like Rep. Mike Simpson of Idaho, are skeptical that Ryan can produce a balanced budget in 10 years. Others suggest it may be easier now with the tax hike on wealthy Americans that the White House won during the recent fiscal cliff crisis.

If Republicans determine they must step back from their 2012 campaign promise not to change Medicare for those over 55, some lawmakers said they can pivot because a year has lapsed.

“When you sit down and explain the situation, people understand,” said Rep. Tom McClintock (R-Granite Bay).

Before then, however, Congress must agree to keep the government running past March 27, when a temporary measure to fund the routine functions of federal offices expires.

Speaking to reporters, Obama made clear he would not risk a government shutdown to refight the budget battle over the across-the-board sequester cuts he signed into law Friday.

Republicans appeared similarly disinclined to refight a battle many in the GOP feel they won, or to risk the political backlash of forcing a government shutdown.

The GOP was badly hurt at the ballot box after a budget battle between President Clinton and a Republican-controlled Congress led to two government shutdowns in late 1995 and early 1996. In all, the federal government furloughed nonessential workers and suspended nonessential services for 28 days.

“Republicans have found in the past that shutting down the government is not a productive exercise,” said Sen. John McCain (R-Ariz.), who suggested that GOP lawmakers considering a shutdown should review that history.

lisa.mascaro@latimes.com

michael.memoli@latimes.com