Obama plan would fix $14B health law glitch

September 19, 2011 - 12:30 PM

WASHINGTON (AP) — President Barack Obama's new deficit plan would fix a $14 billion glitch in his health care law.

Unless the problem gets fixed, a million or more middle-class early retirees could get nearly free Medicaid coverage meant for the poor.

The administration downplayed concerns when The Associated Press reported on the glitch this summer. Officials then acknowledged a fix was needed.

The problem began after the health care law changed Medicaid rules so Social Security benefits would no longer count as income, as they do now.

Because of the glitch, married early retirees making $64,000 a year could qualify for Medicaid. Medicare's top number cruncher, Richard Foster, said that situation didn't make sense but policymakers weren't interested in addressing it.

The fix saves taxpayers $14.6 billion over 10 years.