This week Representative Paul Ryan and Senator Ron Wyden unveiled a new reform proposal for Medicare. As much as I would like to dissect it I’m going on vacation tomorrow and don’t really have the time. However, I’ve found some well-written pieces that should suffice. So these are the links to what I’ve been reading: the Ryan-Wyden edition.
[…]The Ryden plan is part of an ongoing attempt by the Republican Party to carve out a more politically sustainable position on Medicare reform. Conservative activists might like Ryan’s original plan, but voters don’t. Wonks might admire its boldness, but they admit that its numbers don’t add up. And so you’ve seen efforts to sand the edges off the idea: Yuval Levin’s “confident market” proposal and Mitt Romney’s Medicare framework, are both efforts to rework Ryan’s plan in a way that preserves traditional Medicare as an option and makes market reforms more palatable to voters. With the Ryden plan, Paul Ryan has joined them in that effort to leave the Ryan plan behind and replace it with something voters — and some Democrats — find less threatening.
Say what you will about House Budget Committee Chairman Paul Ryan, R-Wis., but he knows a thing or two about how to shift the Overton Window. If 18 months ago he’d unveiled a plan to drastically cut Medicare spending and also partially privatize the program, nobody would have thought it was in any way bipartisan or a compromise. Yet at a Dec. 15 press conference, Ryan was able to unveil the plan in partnership with Sen. Ron Wyden, D-Ore., and get it—accurately—described as a major leftward shift in his own thinking.
[…]That being the case, the real question is whether this plan makes it politically easier to enact and enforce such a budget than past efforts – in other words, would we be treated, in a Wyden-Ryan world, to the annual ritual of raising the Medicare ceiling instead of the annual ritual of enacting the doc fix. The optimistic case here is that interposing an unsympathetic private entity – the private insurer – makes it easier for the government to impose budget rules which, in turn, force that private entity to put the squeeze on providers, rather than having the fight be between evil government bureaucrats and noble health-care professionals. I’m not convinced I should be optimistic, but I think that’s the case.
[…]A few comments about these ideas: First, to many readers this should look familiar. It’s similar to the Domenici-Rivlin proposal and a form of competitive bidding, about which I’ve written a great deal. My ongoing premium support series includes similar ideas and critiques of them. With the exception of including a public option (traditional Medicare), the scheme is similar to the ACA exchanges.
[…]But the option they describe as “traditional” Medicare wouldn’t quite be Medicare as-we-know-it. Seniors would have to buy in using capped premium support payments (similar to vouchers, but with the federal government serving as a go-between for seniors and insurers). If “traditional” Medicare couldn’t hold down costs and premiums, seniors might have to spend some of their own money in order to stay in the program. The idea is to create savings through competition, on the assumption that seniors will pick plans that represent the best value for their own health needs. And, at least in theory, that’s how this plan restrains the growth of Medicare: The value of the premium support payments is capped at GDP plus 1 percent, meaning that spending on the program grows only a little faster than the economy.
Paul N. Van de Water
The proposal for Medicare premium support by House Budget Committee Chairman Paul Ryan (R-WI) and Senator Ron Wyden (D-OR) differs in key respects from how many media reports are describing it. Despite claims to the contrary, it likely would shift substantial costs to beneficiaries rather than protect them from such cost increases, could lead to the demise of traditional Medicare over time rather than preserve it, and likely would produce few savings.
More Ezra Klein
Let’s take a step back from the Wyden-Ryan Medicare plan and take a look at the arguments behind it, and the positions that any compromise health-care proposal purports to be bridging.
Liberals and conservatives disagree about how best to control costs in the health-care system. Conservatives believe health care can be a market like any other, in which competition leads to innovation, and innovation leads to higher quality and lower costs. The problem, they say, is that government, mainly through Medicare and subsidies for employer-based health insurance, is interfering in this market. Remove the government interference, and we could finally control costs.
Liberals believe that health care is not a market like any other. If you don’t like the price Best Buy is offering on a 42-inch Sony plasma TV, you walk out. You can’t do that when you collapse on the street and wake up in the ICU. And even in calmer circumstances, health care is devilishly complex, and the stakes are as high as they can possibly get. That’s why we listen to experts with many, many years of medical training. And as the insurance industry found out when HMOs began trying to deny care in the mid-1990s, woe be unto the bureaucrat who stands between a patient and her doctor.
So health care is unique because it’s a sector in which consumers can’t say no.[…]