Posts Tagged ‘Voucher program’

GOP VP Candidate Paul Ryan Advocates “Medicare Premium Support”

Wednesday, September 5th, 2012

Now that Representative Paul Ryan (R-WI) has been selected by former Governor Mitt Romney (R-MA) as his vice presidential running mate, the debate is focusing on the Wisconsin representative’s plan to reform Medicare.  Known as Medicare Premium Support, it “refers to a system under which Medicare enrollees would pick from a menu of competing plans with a fixed government payment to help defray premium costs.  Enrollees would be on the hook for any charges above the government contribution.  But they could save money by selecting a plan with a premium below the federal subsidy.”

Ryan says that under his plan, the government’s contribution toward premiums will equal the cost of the second least expensive plan in any market — or traditional Medicare — whichever costs less.  Ryan believes that his plan is politically feasible because it doesn’t begin until 2022 with the result that it retains traditional Medicare for Americans who were 55 and older in 2011 — meaning that baby boomers are exempt from the changes.  Democrats who oppose the plan contend that Ryan’s Medicare overhaul would subject seniors to the vagaries of the private market, leaving them with little protection against rising premiums and negligible benefits.

So what is the difference between the Democratic and Republican cuts to Medicare?  The ACA stresses government control and central planning. The law creates a panel of 15 unelected government officials, called the Independent Payment Advisory Board (IPAB) to direct changes that will shrink spending by cutting physician and hospital reimbursement.  The Wyden-Ryan plan preserves the ACA’s targets for future Medicare spending, but uses competitive bidding.  Seniors would have the same benefits that they do now, and would have the option of choosing from several government-approved private insurance plans.

The Republican budget targets Medicare growth of GDP plus 0.5 percent, just as the 2013 Obama budget does. The difference lies in the fact that the GOP budget repeals the ACA, while maintaining that law’s Medicare cuts.  The Democratic budget leaves the ACA in place.

Writing in the Washington Post, Ezra Klein puts the difference in a nutshell:  “The difference between the two campaigns is not in how much they cut Medicare, but in how they cut Medicare.”

In an exclusive interview with Modern Healthcare magazine, Ryan says that “This is an idea whose time has come.  And it’s a bipartisan idea.  What Representative Ron Wyden (D-OR) and I tried to do was to plant the seeds of a bipartisan consensus.  We knew we weren’t going to pass it because of the politics.  We did this together to get the consensus-building started.”  Ryan believes that the plan’s chances for approval will greatly improve in 2013 — especially if the Romney/Ryan team wins the November 6 presidential election.  “I’m actually pretty optimistic,” he said, noting that the United States should reform healthcare on its own terms and “fix this on our terms” instead of borrowing European ideas.  “We believe there are far superior ways to get back to a patient-centered healthcare system, the nucleus of which is the patient and doctor — and not the government,” Ryan said.  “We believe consumer-driven, market-based reforms do more to alter the cost curve of healthcare inflation.”

If Ryan’s plan is enacted into law, people 55 and younger would see a change from one in which everyone gets the same set of government-paid benefits to one in which the government gives all senior citizens a fixed amount of money.  They could use this to purchase private insurance or pay a portion of the cost of enrolling in traditional Medicare.  Ryan has not said how much the premium support payment would be.  But he would limit the annual growth rate to no more than one-half percent more than the economy’s overall growth rate, even though healthcare costs are rising at a significantly faster pace.  Ryan’s plan would also raise the Medicare eligibility age to 67 from 65 by 2034.

Not so fast,” Democrats warn as partisans from both parties accuse the other side of throwing senior citizens under the bus.  “Make no mistake about it — these Republicans don’t believe in Medicare,” Obama campaign senior adviser David Axelrod said.  “They want to turn it into a voucher program.  And slowly, all the burden is going to shift to seniors themselves.  And that is not an answer to entitlement reform.”

Republicans counter that $716 billion in cuts to Medicare are already a part of the Patient Protection and Affordable Care Act (ACA).  An online video created by the Republican National Committee features Ryan saying that Democrats “have refused to make difficult decision because they are more worried about their next election than they are about the next generation.”  According to Ryan, “We won’t duck the tough issues; we will lead.”

Uwe Reinhardt, a healthcare economist at Princeton University disagrees, saying that rather than motivating insurers to control their costs, the Ryan plan will not benefit seniors.  “You’re essentially shoving these guys out on a boat, saying, ‘We’ll give you a push, but if the waves are rough, you’re on your own,” he said.  “It would really worry me if I were a middle-class American.”

Mitt Romney Says “No” to Medicare on His 65th Birthday

Monday, March 19th, 2012

Even though he just celebrated his 65th birthday, GOP presidential hopeful Mitt Romney isn’t signing up for Medicare or Social Security.  According to an aide, Romney plans to keep his private health insurance plan although there is no word on whether he accessed that plan through a former employer or bought it on the individual market.  Ironically, if elected, Romney wants to offer senior citizens the choice of enrolling in the traditional program or purchasing private insurance with some financial help from the government.

Romney’s decision puts him in a tiny minority. The vast majority of seniors participate in Medicare.  Nearly all seniors are automatically enrolled in Medicare Part A, which covers hospital care, although they can opt not to use it.  Another 95 percent enroll in Medicare Part B, which covers physician services, according to the Kaiser Family Foundation.

“It was personally meaningful in me to be enrolling in the program I ran.  It made me feel one step closer to the beneficiaries,” Dr. Donald Berwick, who left his post at the Centers for Medicare and Medicaid Services (CMS) at the end of 2011, said.  “It validated what I had thought — which was that it was remarkably easy [to sign up].  Any president, at any age, should be committed to these important programs,” Berwick said.

By contrast, two of Romney’s competitors — Newt Gingrich and Ron Paul — are already 65, the age at which most Americans become eligible to enroll in Medicare’s coverage of hospital treatment, physician visits and other medical care, including prescription drugs.  Gingrich has a Medicare Advantage plan, administered by Blue Cross Blue Shield, according to his campaign.  Medicare Advantage plans are run by private insurance companies, who receive a fixed monthly payment from the federal government.  Gingrich frequently plugs Medicare Advantage and wants to expand the proportion of seniors who enroll in it from the current 25 percent.  Congressman Paul has a federal government-sponsored Blue Cross Blue Shield employee health insurance plan.  He has said that he would not change any aspect of Medicare for current beneficiaries but would let younger people opt out of the program and use medical savings accounts or other ways to pay their own healthcare costs.

According to NPR’s Julie Rovner, “Romney is clearly making a political point.  Wealthy people like him ought to pay more for their Medicare benefits (if they get them at all) and that perhaps 65 is a little young to qualify, too.  ‘Wealthier seniors will receive less support,’ under the changes Romney has proposed for Medicare, according to his website. http://www.mittromney.com/issues/medicare At the same time, he is proposing to ‘gradually raise the retirement age to reflect increases in longevity.’  But could his political point cost him more down the road if he changes his mind?  Maybe.  Medicare charges penalties for those who wait to sign up.  It’s the program’s way of ensuring that people don’t wait until they get sick to enroll.”

Beneficiaries currently have a seven-month window to sign up for Medicare: three months before their birth month, the month of their birthday, and three months after their birthday.  That means that Romney has through June to enroll if he changes his mind.  The majority of adults use the Social Security Administration website to enroll for their benefits, while others go to local district offices.

Writing for the Huffington Post, Ethan Rome, Executive Director of Health Care for America Now, says that “I’m not sure what Romney’s trying to prove, but what his action says is clear: I’m not like the Americans who enroll in Medicare.  I’m special.  I’m rich.  I’m better than you.  Ask yourself: If Romney doesn’t need or want Medicare for himself, will he protect it for the rest of us who do?  Of course not.  Instead, he’ll continue to support the Republican plan to eliminate Medicare as we know it.  He’ll work to turn Medicare into a voucher program that will saddle seniors with thousands of dollars in out-of-pocket health care costs.  Because, after all, what senior can’t afford to spend an extra $6,400 a year on doctors and hospitals?  Before Medicare, seniors were left at the mercy of the private market and therefore virtually uninsurable.  Without insurance, even brief hospital stays could impoverish them.  The result was that the elderly went without the care they needed — unless their families were rich.  Most seniors were one illness away from bankruptcy.”