Wed Aug 22, 2012, 12:19 PM
flamingdem (27,041 posts)
Paul Ryan and the Promise of I've-Got-Mine-ism (current Seniors ARE impacted)
The reason Ryan gets away with this is the reason that Republicans won the Medicare issue in 2010, taking seniors from a 50-50 vote to a 60-40 pro-GOP vote. He puts Medicare, theoretically, in a sort of lock-box. He promises to treat it separately from every other government program, and promises seniors of a certain age that they won't have to sacrifice -- the system will be scaled back for the generations behind them, giving their grandkids less care but less government debt. It's the "get your government hands off my Medicare" slogan made pseudo-wonky.
Only it doesn't quite work. Henry Aaron is a scholar at Brookings credited with developing the "premium support" idea that Ryan bases his Medicare reforms upon. He's been pretty adament about one thing: The Ryan plan is not the premium support he wanted. "Income grows a few percentage points faster than prices," he warned in 2011. Aaron keeps saying this and saying this and waiting for someone to grok it. On Monday, he published a little-read op-ed, attempting to explain how it was impossible, if Medicare was reformed along Ryan lines, to expect no changes for current retirees.
The claim that the Ryan plan leaves Americanís over age 55 unaffected is untrue because it is likely to raise the amount they have to pay out-of-pocket for insurance. The reason is technical, but easy to understand. The premium for those who stay in traditional Medicare under the Ryan plan would be calculated as under current law, but the average cost of serving those who remain in traditional Medicare would go up as private insurance companies market selectively to those with relatively low anticipated costs. The average cost of those who remain in traditional Medicare would therefore increase. As a result of this gap, the financing for traditional Medicare would become progressively less adequate, throwing into doubt the very survival of the program.
Get it? Seniors will have the choice of traditional Medicare or "premium support." But as fewer and fewer people join the system, the government's bargaining power decreases. Ryan's betting on the invisible hand to fix this, with private insurers bringing costs lower and lower. But that's not a guarantee that Medicare for someone who's 65 years old in 2015 will be the same for that person when he turns 75. And Ryan's claming that it will be.
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