[or was that "entitlement reform is health care reform"?]

Public option! Look! Over there! Sarah Palin! Now with Death Panels! Public option! And a Congresscritter with the audacity to call the President a liar! On national TV no less! Public option!

To be fair to all his observers, Obama, self-described blank screen and pretty good poker player, has been about as transparent as a mud-brick wall on what his designs on plans for Medicare really are.

Except that like everything else, he's been dropping hints on his thinking [or lack of] here too. Surely it was evident that anybody who believes that the Dartmouth Gospel Atlas Project has proven beyond the shadow of a doubt that old people get 30% too much health care was intent on wringing out more than just 'waste, fraud, and abuse' from the system.

Today, Scarecrow, over at FDL, reads the tea leaves in Obama's bestest health care speech evar.

So you'd talk about eliminating "waste, fraud and abuse" in the system. Few would believe there's much hope in that, so you'd add the idea of changing the provider payment incentives to get equal or better care by changing how providers practice medicine. You'd talk about "bending the cost curve" and warn folks that unless we did something dramatic, the Medicare deficits would overwhelm the federal budget and dominate the GDP.

It would be useful to have bipartisan cover for the risks of incurring seniors' wrath, but since the Republicans would be unlikely to participate openly in such a scheme and would rather use it to scare seniors, you probably couldn't count of them. So you'd settle for a small, manageable "bipartisan" group you could more easily control and which would provide at least temporary cover while you put the package together.

Of course, the core of the Democratic Party would never stand for doing this in lieu of pursuing universal coverage, let alone doing it alone and accepting the risks. But you might be able to convince them you were trying to enact broader "health care reform" and then slip the Medicare package inside the broader effort. That would get the Democrats, including the reform-minded progressives, fully engaged in the details of "reform" while continuing to move the main Medicare piece through the more controlled "gang of six."

Noooooo! Obama would never touch Medicare! But how else to interpret this passage from Wednesday night?

Finally, let me discuss an issue that is a great concern to me, to members of this chamber, and to the public – and that is how we pay for this plan.

Here's what you need to know. First, I will not sign a plan that adds one dime to our deficits – either now or in the future. Period. And to prove that I'm serious, there will be a provision in this plan that requires us to come forward with more spending cuts if the savings we promised don't materialize. Part of the reason I faced a trillion dollar deficit when I walked in the door of the White House is because too many initiatives over the last decade were not paid for – from the Iraq War to tax breaks for the wealthy. I will not make that same mistake with health care.

Second, we've estimated that most of this plan can be paid for by finding savings within the existing health care system – a system that is currently full of waste and abuse. Right now, too much of the hard-earned savings and tax dollars we spend on health care doesn't make us healthier. That's not my judgment – it's the judgment of medical professionals across this country. And this is also true when it comes to Medicare and Medicaid.

You can hope that by "there will be a provision in this plan that requires us to come forward with more spending cuts" he means something like "we'll make the insurance companies give up their obscene profits" but what part of health care spending does the federal government really have jurisdiction over? If you guessed Medicare, you get a gold star -- and we may yet be in time to keep old people off the ice floes.

Yes, at this point it's still only a guess that he means to wring further $$$$$ to pay for health care deform insurance reform out of Medicare, but Obama advisor David Cutler, who sounds eminently reasonable on health care, has teamed up with former Clinton White House official Judy Feder to produce the white paper Financing Health Care Reform, A Plan to Ensure the Cost of Reform Is Budget-Neutral.

Ezra Klein posts his interview with Judy Feder today where he asks her about their proposed health care reform financing.

EK: How does a fiscal trigger work?

JF: The idea of a trigger is that one establishes in advance a target for savings in the system, agrees on measures that need to be achieved, track that progress as the program is implemented, and if shortfalls are found, then certain actions are automatically triggered in.

EK: What are those actions? What happens when you pull the trigger?

JF: David Cutler and I put forward a range of options and believe a menu should be specified in the legislation. That menu could include further reductions in Medicare or changes in the tax treatment of employer-based efficiency or a strengthening of a public plan to further competition with insurers.

So yeah, taking a sharpened steak knife to Medicare is on the table.