Paul Ryan Misrepresents The “Mandate” In His Medicare Voucher Plan, Again
The inimitable Digby points us to another effort by Rep. Paul Ryan to misrepresent his deeply unpopular Medicare voucher plan. It’s not clear whether Ryan simply doesn’t understand his own proposal or is just a serial liar.
Digby links to coverage (and the video here) at Think Progress, which catches Ryan admitting that his plan requires a “mandate” but then claiming falsely that “[i]t literally would be like Medicare Advantage.”
Q: If Medicare becomes a voucher program, would you require seniors to purchase private insurance and if so isn’t that an individual mandate? If you will not require them to purchase insurance how do you propose to prevent a situation where the costs of uninsured seniors is very expensive and gets passed on to me as a private policy holder? […]
RYAN: Its mandate works no different than how the current Medicare law works today, which is you just select from a wide range of different plans. It literally would be like Medicare Advantage…
Having shown that Ryan’s plan has a “mandate” for those who later reach 67 (yeah, he’d raise Medicare’s eligibility age, too) just as the Affordable Care Act does for those under 65, TP’s Igor Volsky then adds this:
All this tells us is that the mandate isn’t some horribly coercive policy aimed at usurping individual freedoms. Rather, it is a mechanism by which government attempts to encourage more individuals to purchase coverage and expand the size of the health care risk pool, thus spreading the costs and risks of insurance across a larger population (and bringing down health care costs). It’s simply asking able individuals to take personal responsibility for their health care expenses and it’s something Republicans have supported in the past and (apparently) still favor.
That general statement about some mandates is fine, but it leaves out the main reasons why the Ryan plan mandate is so offensive, such bad public policy and so unpopular. But to see this, we need to recognize there are good and necessary mandates, lousy mandates, and truly awful mandates. Consider the following possible frameworks that include some type of mandate for the covered group:
1. Everyone has to pay taxes (allocated through whatever progressive means you want) to cover program costs. Everyone gets full Medicare coverage. The coverage keeps up with the rising costs of care, so government makes best efforts to control costs. This would be a form of single-payer, or if we’re only talking about seniors, straight Medicare.
2. Same as 1, but beneficiaries get a choice between government-provided Medicare or private insurance that must cover at least the same benefits. The private insurers must offer/provide coverage for anyone who asks and receive a voucher from the US Government equal to (at least) the average cost of Medicare. Government Medicare and the private equivalent funded through government vouchers will make best efforts to keep up with the rising cost of care. This is the current framework for Medicare with the choice of Medicare Advantage (which actually gets a subsidy). But that’s not Ryan’s proposal.
3. Everyone under 65 has to purchase insurance from either a government Medicare-like plan (public option) or a private insurance plan providing at least the same defined benefits. The government will provide vouchers to some, but not all, based on need to help cover the cost of either form of insurance. This is the framework with a “public option” that some liberals wanted in the Affordable Care Act. They didn’t get it.
4. Everyone has to purchase private insurance; there is no public/Medicare option. The government will provide vouchers to some, but not all, based on need to help cover the cost of the private insurance. The government vouchers will increase in an effort to keep up with rising insurance costs for those most in need. This is the framework of the Affordable Care Act: a mandate with limited vouchers but only for private insurance.
5. Same as 4 for seniors — everyone has to purchase private insurance — except the government will provide vouchers that diminish in value relative to the rising costs of health care, thus shifting the uncovered rising costs to the beneficiaries who must either use more of their income for insurance or go without health care. There is no public/Medicare option. This is the Ryan Plan.
As you can see, each of these frameworks has a “mandate,” but they differ significantly in what beneficiaries get, what choices they have, and how much rising costs are the responsibility of the government to affect versus being shifted to the individual.
Just having a “mandate” doesn’t make these plans the same. As you go down the list, the most meaningful choice of a “public” option disappears, and costs become increasingly decontrolled and shifted to individuals. Even worse, as you go down the list, market power — the ability to affect prices — gets transferred from the public as a whole to insurers and providers, so that individuals are left effectively powerless.
By the time you get to Paul Ryan’s Framework #5, you have the worst of all worlds: restricted choice, highest costs, the most cost shifting, and the greatest vulnerability to market power being exercised by the highly concentrated insurance and health industries.
And because Ryan eliminates the government’s ability to lower administrative costs and use its buying power to lower prices, his plan is guaranteed to have the most expensive outcome. As Dean Baker often reminds us, the CBO estimated that the higher cost for Medicare-equivalent insurance would be more than $30 Trillion over coming decades under Ryan’s plan. In other words, if Medicare’s rising costs (from rising provider costs) are a serious threat to US debt and the main reason for deficit hysteria, then Ryan’s plan is trillions of dollars worse for the rest of the economy.
So, sure, all these plans include some form of “mandate,” and in a true universal system, some form of mandate is needed to increase the risk pool, as Volsky says. But not all mandates are the same. Paul Ryan’s mandate plan is by far the dumbest, most “careless,” and most expensive way to include a mandate anyone has proposed. His mandate strips individuals of economic power and forces them to transfer tens of trillions in their wealth to insurers and health corporations.
[edited to correct spelling for Igor Volsky]