Warning: Real world politics / economics incoming!

Most of the political coverage right now is focused on, what can only be described as, Mediscare tactics from both sides. I wanted to explain, in as neutral a fashion as possible, the truth about where each group is coming from. Let's establish some terminology first.

Obamacare / PPACA: This is the law currently being operated under
Ryan budget #1: Paul Ryan's first budget (circa 2009)
Ryan budget #2: Paul Ryan's current budget (circa 2011)
Romney Plan: The Presidential candidates plan

Here's what each of them does with Medicare:

Obamacare / PPCAC: Reduces Medicare by $700B (true). It does this over 10 years (a really critical distinction) and it does it by reducing reimbursement rates. It is a debatable point whether it reduces them too much (i.e. to the point where it makes the medicare transaction unprofitable and pushes people out of the market). It partially offsets this with a plug of the doughnut whole of Medicare Part D.

Ryan budget #1: Contains the same $700B in medicare cuts and gets at them in a different way (i.e. reducing reimbursements). My understanding is that this would immediately flip people (perhaps only newly retired people, unclear) to a voucher system (note: the Republicans don't like "voucher" because it doesn't really test well and the plan has some differences... but voucher is the best word I can think of for it) . It is a (highly?) debatable point on whether or not this would result in decreased benefits for seniors. Medicare Advantage is somewhere between "no cheaper" and "20% more expensive" depending on who you listen to. But no one that I know of is trying to claim that Medicare Advantage has resulted in cheaper care. So if the reimbursement rate (i.e. value of the voucher) is fixed at something lower than health costs rise, seniors are either going to get cheaper care or less care.

Ryan budget #2: Contains the same $700B and vouchers but because of changes in the voucher system, some of Obamacare's reimbursement reductions are brought in. The new plan would allow bidding on health care with the option of taking existing medicare or the 2nd cheapest plan in the bidding. This sounds like a net INCREASE in medicare costs (why wouldn't you choose the plan that gave you more and therefore probably cost more) but with the reimbursement cuts, it might not be. If Medicare becomes a less desirable option for health care (because it's hard to find a doctor who will take it) then the issue becomes less clear.

Romney budget: I'll admit, this one has me stumped. Romney stated clearly and unequivically yesterday that he'd change nothing for those 55 years and older. He would institute means testing for people below that age (when they hit retirement age). He indicates that this would attain solvency for the system. My rough math indicates that the means testing would have to mean no benefits for the top 1/3rd of earners (obviously, it would probably be scaled so it could affect a significantly wider swath).

Summary, Obamacare, Ryan #1 and Ryan #2 all result in $700B in savings over the next ten years (note: these are savings ALREADY built into the current budget numbers... so if you hear someone talk about Obama's $22T national debt projected in year 10 then remember that that's $700B lower than it would have been otherwise). Romney's plan would add $700B to this baseline. Obamacare, Ryan #1 and Ryan #2 all result in savings to the budget. They all will affect current seniors in some way (the magnitude of the affect is unclear). Romney's plan claims to return Medicare to solvency but it's hard to see how that realistically occur.