LEHRER: All right? All right. This is segment three, the economy. Entitlements. First -- first answer goes to you, two minutes, Mr. President. Do you see a major difference between the two of you on Social Security?
OBAMA: You know, I suspect that, on Social Security, we've got a somewhat similar position. Social Security is structurally sound. It's going to have to be tweaked the way it was by Ronald Reagan and Speaker -- Democratic Speaker Tip O'Neill. But it is -- the basic structure is sound.
But -- but I want to talk about the values behind Social Security and Medicare, and then talk about Medicare, because that's the big driver of our deficits right now.
You know, my grandmother -- some of you know -- helped to raise me. My grandparents did. My grandfather died a while back. My grandmother died three days before I was elected president. And she was fiercely independent. She worked her way up, only had a high school education, started as a secretary, ended up being the vice president of a local bank. And she ended up living alone by choice.
And the reason she could be independent was because of Social Security and Medicare. She had worked all her life, put in this money, and understood that there was a basic guarantee, a floor under which she could not go.
And that's the perspective I bring when I think about what's called entitlements. You know, the name itself implies some sense of dependency on the part of these folks. These are folks who've worked hard, like my grandmother, and there are millions of people out there who are counting on this.
OBAMA: So my approach is to say, how do we strengthen the system over the long term? And in Medicare, what we did was we said, we are going to have to bring down the costs if we're going to deal with our long-term deficits, but to do that, let's look where some of the money's going.
$716 billion we were able to save from the Medicare program by no longer overpaying insurance companies by making sure that we weren't overpaying providers. And using that money, we were actually able to lower prescription drug costs for seniors by an average of $600, and we were also able to make a -- make a significant dent in providing them the kind of preventive care that will ultimately save money through the -- throughout the system.
So the way for us to deal with Medicare in particular is to lower health care costs. When it comes to Social Security, as I said, you don't need a major structural change in order to make sure that Social Security is there for the future.
LEHRER: We'll follow up on this.
First, Governor Romney, you have two minutes on Social Security and entitlements.
ROMNEY: Well, Jim, our seniors depend on these programs, and I know anytime we talk about entitlements, people become concerned that something's going to happen that's going to change their life for the worse.
And the answer is neither the president nor I are proposing any changes for any current retirees or near retirees, either to Social Security or Medicare. So if you're 60 or around 60 or older, you don't need to listen any further.
But for younger people, we need to talk about what changes are going to be occurring. Oh, I just thought about one. And that is, in fact, I was wrong when I said the president isn't proposing any changes for current retirees. In fact he is on Medicare. On Social Security he's not.
But on Medicare, for current retirees, he's cutting $716 billion from the program. Now, he says by not overpaying hospitals and providers. Actually just going to them and saying, "We're going to reduce the rates you get paid across the board, everybody's going to get a lower rate." That's not just going after places where there's abuse. That's saying we're cutting the rates. Some 15 percent of hospitals and nursing homes say they won't take anymore Medicare patients under that scenario.
We also have 50 percent of doctors who say they won't take more Medicare patients.
This -- we have 4 million people on Medicare Advantage that will lose Medicare Advantage because of those $716 billion in cuts. I can't understand how you can cut Medicare $716 billion for current recipients of Medicare.
Now, you point out, well, we're putting some back. We're going to give a better prescription program. That's $1 -- that's $1 for every $15 you've cut. They're smart enough to know that's not a good trade.
I want to take that $716 billion you've cut and put it back into Medicare. By the way, we can include a prescription program if we need to improve it.
But the idea of cutting $716 billion from Medicare to be able to balance the additional cost of Obamacare is, in my opinion, a mistake.
And with regards to young people coming along, I've got proposals to make sure Medicare and Social Security are there for them without any question.
LEHRER: Mr. President?
OBAMA: First of all, I think it's important for Governor Romney to present this plan that he says will only affect folks in the future.
And the essence of the plan is that you would turn Medicare into a voucher program. It's called premium support, but it's understood to be a voucher program. His running mate...
LEHRER: And you don't support that?
OBAMA: I don't. And let me explain why.
ROMNEY: Again, that's for future...
OBAMA: I understand.
ROMNEY: ... people, right, not for current retirees.
OBAMA: For -- so if you're -- if you're 54 or 55, you might want to listen 'cause this -- this will affect you.
The idea, which was originally presented by Congressman Ryan, your running mate, is that we would give a voucher to seniors and they could go out in the private marketplace and buy their own health insurance.
The problem is that because the voucher wouldn't necessarily keep up with health care inflation, it was estimated that this would cost the average senior about $6,000 a year.
Now, in fairness, what Governor Romney has now said is he'll maintain traditional Medicare alongside it. But there's still a problem, because what happens is, those insurance companies are pretty clever at figuring out who are the younger and healthier seniors. They recruit them, leaving the older, sicker seniors in Medicare. And every health care economist that looks at it says, over time, what'll happen is the traditional Medicare system will collapse.
OBAMA: And then what you've got is folks like my grandmother at the mercy of the private insurance system precisely at the time when they are most in need of decent health care.
So, I don't think vouchers are the right way to go. And this is not my own -- only my opinion. AARP thinks that the -- the savings that we obtained from Medicare bolster the system, lengthen the Medicare trust fund by eight years. Benefits were not affected at all. And ironically, if you repeal Obamacare, and I have become fond of this term, "Obamacare," if you repeal it, what happens is those seniors right away are going to be paying $600 more in prescription care. They're now going to have to be paying copays for basic checkups that can keep them healthier.
And the primary beneficiary of that repeal are insurance companies that are estimated to gain billions of dollars back when they aren't making seniors any healthier. And I don't think that's the right approach when it comes to making sure that Medicare is stronger over the long term.