Deja Vu? Cutting Entitlements?
A colleague yesterday sent me a link to a story about Speaker Ryan’s plan to introduce cuts to Medicare (or eliminate it in its current form as we know it). (Of course, this was after the class where we had just finished covering Medicare). All I could think was, not again…. By not again, I meant here is another proposal heading to Congress to change (or eliminate) one of the entitlement programs. We’ve weathered the proposals to change Social Security (Remember the Commission appointed by President George W. Bush?). Now it’s Medicare.
There is information on Speaker Ryan’s website about his plan to change Medicare. A series of articles have popped up in the last few days as a result of his recent interview appearing on Fox. In Talking Points Memo, Ryan Plans to Phase Out Medicare in 2017, the transcript of the interview appears. Here’s a quote:
What people don’t realize is because of Obamacare, medicare is going broke, medicare is going to have price controls because of Obamacare, medicaid is in fiscal straits. You have to deal with those issues if you are going to repeal and replace obamacare. Medicare has serious problems [because of] Obamacare. Those are part of our plan.
The article describes his position as a phase-out of Medicare, although current beneficiaries keep Medicare.
Money magazine also ran an article, questioning the Speaker’s assertion that Medicare is going broke. Is Medicare Really Going Broke, Like Paul Ryan Says?
Here’s the thing: Medicare is on an unsustainable spending path, but it’s not going broke. “The idea that we have a crisis is just nonsense,” says Dr. Robert Berenson, a fellow at the Urban Institute, a nonpartisan research organization, and formerly an official at the Centers for Medicare and Medicaid Services. And Obamacare is not the culprit for Medicare’s fiscal woes.
The article notes that his plan proposes
changes [that] generally fall under the terms “privatization,” or “premium support.” While it remains unclear exactly what this would look like, it may mean giving beneficiaries some sort of fixed dollar amount to buy their own private insurance as an alternative to, or even replacement for, original Medicare… Under this type of system, beneficiaries who choose the lowest-cost coverage will stretch their government subsidy the farthest—which ironically, is how Obamacare works today.
The Washington Post ran an article about it, focusing on whether this is an “opportunity” for the Democrats, Paul Ryan’s plan to phase out Medicare is just what Democrats need. The Washington Post article offers a sobering assessment
If Ryan gets his way, Medicare as a universal insurance program will cease to exist. It will be replaced by “premium support,” or vouchers which seniors will use to buy private insurance. If you can’t afford any of the available plans with what the voucher is worth, tough luck. The whole point is to transfer the expense from Medicare to the seniors themselves. Half a century after Medicare brought health security to America’s seniors, Republicans would snuff it out, leaving some unknown number without any coverage at all and breaking the fundamental promise the government made.
Serious bummer folks.