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GOP Continues Death Grip on Medicare Phase-Out Plan

Not only will the House today walk the plank again on the Ryan budget that ends Medicare, but as we’ve seen, the plan has become a litmus test in the 2012 GOP Presidential primary. Jon Huntsman, who is trying to distinguish himself in that field, gave Ryan’s plan an endorsement today in a Wall Street Journal op-ed, though a pretty light one. After the usual deficit and debt fearmongering (can we call this the Defiscare?), as well as some dishonesty about America’s “second-highest corporate tax rate in the world” (but only in nominal, not effective, terms) and the need for free trade agreements, Huntsman addresses the Ryan plan:

I admire Congressman Paul Ryan’s honest attempt to save Medicare. Those who disagree with his approach incur a moral responsibility to propose reforms that would ensure Medicare’s ability to meet its responsibilities to retirees without imposing an unaffordable tax burden on future generations of Americans.

That’s all Huntsman thinks it’s going to take? “Admiring” the Ryan plan and daring others who disagree to propose their own reform? This is pretty weak stuff. First of all, Ryan’s plan does not “ensure Medicare’s ability to meet its responsibilities to retirees.” There’s no guarantee that private insurance companies would accept seniors armed with a voucher; there’s no mandate in the plan. And because the voucher is too small and shrinks relative to health care cost increases over time, more seniors would be unable to purchase coverage. Finally, seniors currently over 55 who get the “same program” of Medicare will be part of a smaller and smaller risk pool as the years go on, and providers will almost certainly pull out of the program. On no level does this meet the responsibilities outlined in the successful Medicare program.

Meanwhile, Ryan has resorted to claiming that Democrats “end Medicare as we know it,” rebutting the same claims about his plan. Recall that he has called that claim demagoguery and the “Mediscare,” and now his strategy is to imitate it.

RYAN: Millions of dollars of negative ads are being run to try and scare seniors and trying to confuse seniors. You know, the irony of this Bill, is with all this Mediscare that the Democrats are running, it’s Obamacare itself that ends Medicare as we know it. Obamacare takes half a trillion dollars from Medicare — not to make it more solvent but to spend on this other government program, Obamacare. And then it creates this 15 panel board of unelected, unaccountable, bureaucrats starting next year to price control and ration Medicare for current seniors.

First of all, the changes to Medicare in the Affordable Care Act extended the life of the Medicare Trust Fund by 12 years, according to the trustees. The half a trillion “taken” from Medicare – I didn’t think Ryan thought that way of entitlements – really cancel Medicare Advantage overpayments and hospital provider payments, and don’t cut back on benefits. This is real cost control, which is why hospitals don’t particularly like it. What’s more, all of the cuts are in the Ryan plan. He repeals “Obamacare” but doesn’t repeal those cuts. They would all remain. Finally there’s the “15-panel board,” by which Ryan means the Independent Payments Advisory Board. I’ll give that to Igor Volsky:

It will include individuals from across the health care field, all of whom will have to be confirmed by the Senate. Significantly, their proposal to reduce spending cannot “include any recommendation to ration health care, raise revenues or Medicare beneficiary premiums…increase Medicare beneficiary cost- sharing (including deductibles, coinsurance, and co- payments), or otherwise restrict benefits or modify eligibility criteria” (Section 3403 (page 409) of the Affordable Care Act stipulates.)

Policy wonks believe that the board and the payment reforms can help reduce costs in a transparent process and Ryan himself proposed a very similar commission in 2009 and maintains many of the ACA’s Medicare cuts in his plan. In fact, Ryan’s Patients’ Choice Act (PCA) sought to establish “two governmental bodies to broadly apply cost effectiveness research” and had more teeth than the ACA, including provisions to allow for penalties for physicians who did not follow the guidelines.”

Ryan’s a dissembler, as if we didn’t know that already. But the public has already reached their verdict on his plan, whether Republicans ride it to oblivion or not.

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David Dayen

David Dayen