This afternoon, President Barack Obama rejected the Medicare and Medicaid reforms in the GOP budget and laid out an alternative proposal to reduce the deficit by $4 trillion over 12 years. “Here, the difference with the House Republican plan could not be clearer: their plan lowers the government’s health care bills by asking seniors and poor families to pay them instead. Our approach lowers the government’s health care bills by reducing the cost of health care itself,” Obama said.

The new “framework” builds on the delivery and cost containment reforms in the Affordable Care Act and would reduce medical cost growth by getting rid of some of the inefficiencies in the system rather than simply shifting the cost burden to beneficiaries. The plan would strengthen the Independent Payment Advisory Board (IPAB) charged with keeping health costs in check, provide states with greater flexibility to manage Medicaid, reduce costly medical errors and hospitals readmissions and use Medicare’s clout to save more money on prescription drugs. But Obama also pledged to defend the integrity of the Medicare and Medicaid programs and the New Deal philosophy of shared costs and sacrifice:

But let me be absolutely clear: I will preserve these health care programs as a promise we make to each other in this society. I will not allow Medicare to become a voucher program that leaves seniors at the mercy of the insurance industry, with a shrinking benefit to pay for rising costs. I will not tell families with children who have disabilities that they have to fend for themselves. We will reform these programs, but we will not abandon the fundamental commitment this country has kept for generations.

Obama’s plan builds on the foundation of the Affordable Care Act and incorporates some of the recommendations offered by The National Commission on Fiscal Responsibility and Reform back in December. The administration estimates that the health changes would “save an additional $340 billion by 2021, $480 billion by 2023, and at least an additional $1 trillion in the subsequent decade.”

At the center of the proposal is a plan to expand IPAB, a 15-person commission tasked with offering Congress a comprehensive proposal for reducing excess growth in Medicare (without rationing care or raising premiums or cost sharing) if costs exceed GDP per capita plus 1 percent. Congress must consider the proposal — essentially changes in payment rates — in full and cannot offer an amend with different reduction goals unless it is agreed to by both chambers of Congress (and 60 Senators.) If Congress fails to adopt a substitute provision, the Department of Health and Human Services must implement the board’s proposal.

In his plan, Obama establishes a more ambitious target of holding Medicare cost growth per beneficiary to GDP per capita plus 0.5 percent beginning in 2018 and gives the board additional powers to determine Medicare payment rates. “There would be some expansion, having a more automatic sequestration so that we don’t have a situation that nothing happens,” a senior administration official explained. The board would still be prohibited from making cuts to hospitals and hospices through 2019 and Congress can still alter IPAB’s recommendations without offsetting the costs. Asked if they would undo some of these restrictions, the senior administration official briefing reporters on the call said, “no, not all of them.”

The IPAB has always been seen as a serious effort at cost control, but Congress’ experience with things like the sustainable growth rate (in which Medicare physicians are shielded from cuts every year) has led some to wonder if the measure will ever be implemented. This is particularly so in the face of baby boom retirement. As far as I can tell, the plan would cap Medicare expenditures at GDP+.5 percent after 2018, which leaves no room for the increase in the number of beneficiaries — a number which is expected to rise from 13 percent of the population today to 22 percent in 2050. Which means, Congress may respond by changing the trigger to avoid making cuts that could have some effect on their constituents.

Aside from the Republican efforts to characterize the IPAB as a rationing board — they’ve already introduced legislation to repeal it — the administration may have a hard time scoring the proposal with the all-important Congressional Budget Office. In March, the organization estimated that “the rate of growth in Medicare spending per beneficiary is projected to remain below the levels at which the IPAB will be required to intervene to reduce Medicare spending.” The board never triggers and so no cuts are made.

While she opposes the short-term budget agreement to cut $38.5 billion in spending for the remainder of 2011 as insufficient, Rep. Michele Bachmann (R-MN) has touted Rep. Paul Ryan’s (R-WI) budget as a real way to cut spending and reign-in the growth of Medicare and Medicaid. “The Ryan budget can be called the 55 and under plan because the goal is to secure and save Medicare, ” Bachmann told me on Monday in Iowa. “We want to save it, we want to secure it. It’s on a collision course right now with bankruptcy. The Ryan plan seeks to do exactly that.”

But this morning, during an appearance on NBC’s Today, Bachmann said she was unfamiliar with the consequences of Ryan’s proposal to voucherize the Medicare program in 2022. Pressed by Matt Lauer about the Congressional Budget Office’s (CBO) report that seniors would have to pay twice as much for health care if they were given vouchers to buy private insurance, Bachmann said she has not yet read the CBO report:

LAUER: The nonpartisan Congressional Budget Office says when they look at the plan they think in the long term this will cause people to actually pay much more of their own health care costs out of their own pocket. Do you agree with that?

BACHMANN: Well, I’ll have to look at that study and I’ll have to look at that report. I can’t comment on it because I haven’t read that study. But I think certainly going forward it’s important for us to understand that individualism, personal responsibility have always been a bedrock of this country. And when we move away from that our budgets get in trouble.

Watch it:

The CBO found that “under the proposal, most elderly people would pay more for their health care than they would pay under the current Medicare system” partly because private insurers have higher administrative costs than traditional Medicare. As the Center for Budget and Policy Priorities (CBPP) demonstrates, in 2022, the first year the voucher would apply, CBO estimates that total health care expenditures for a typical 65-year-old “would be almost 40 percent higher with private coverage under the Ryan plan than they would be with a continuation of traditional Medicare”:

But unfortunately, Bachmann hasn’t actually bothered to read about the effects of the policies she advocates.

Likely GOP presidential contender Mitt Romney refused to say if the individual mandate that was part of the health care reform law he enacted in Massachusetts five years ago yesterday was a mistake, dodging a pointed question from CNBC’s Larry Kudlow. Romney did not warmly embrace his reforms — which bear many striking similarities to the Affordable Care Act — referring to the law as an “experiment” that is “not perfect.”

Pressed specifically on the mandate, Romney regurgitated his argument about states finding their own solutions to the health care crisis:

KUDLOW: Did the mandate work Governor? Because that’s the big sticky point. It’s also the subject of the various court protests going on right now, which may overturn Obamacare. The mandate, was that your biggest mistake in Massachusetts?

ROMNEY: One thing I learned, is this. That you don’t take ideas from a state and try to impose them on a whole nation. Our nation is too diverse, too different to say that what works in Massachusetts is somehow going to be grabbed by the federal government, usurping the power of states and imposing a one-size-fits all plan on the nation.

Watch it:

Romney’s answer represents a striking shift in both tone and emphasis. During an appearance on Fox News Sunday in March 2010, for instance, Romney highlighted his support for the law and the individual health insurance mandate. “I think our plan is working well. And perhaps the best thing I can say about it, it’s saving lives. It is the ultimate pro-life effort,” he said. “We said people have to take responsibility for getting insurance if they can afford it or paying their own way. No more free riders.”

Romney described the law as “the ultimate conservative plan,” touted the fact that 98 percent of Massachusetts residents now have health insurance, and said that the plan is “coming in below budget.” Watch that interview here.