Ron Wyden, the Oregon Democrat, is considered one of the Senate’s staunchest Medicare defenders. So what is he doing working with U.S. Rep. Paul Ryan on a plan to unravel the federal health-care program?
From the Times:
The new Wyden-Ryan proposal would make major structural changes in Medicare and limit the government’s open-ended financial commitment to the program.
Under the proposal, known as premium support, Medicare would subsidize premiums charged by private insurers that care for beneficiaries under contract with the government.
Congress would establish an insurance exchange for Medicare beneficiaries. Private plans would compete with the traditional Medicare program and would have to provide at least the same benefits. The federal contribution in each region would be based on the cost of the second-cheapest option, whether that was a private plan or traditional Medicare.
In addition, the growth of Medicare would be capped; in general, spending would not be allowed to increase more than the growth of the economy, plus 1 percentage point — a much slower rate of increase than Medicare has historically experienced.
The plan is supposed to open the existing system to competition and lower prices, which seems unlikely. The problem with Medicare is not that it lacks competition, but that it is far too small a program and only includes the segment of society that uses the most health care. What we know about Medicare, when compared with other insurance options, is that it has much lower overhead than the private sector. Its costs have been rising not because of inefficiency but because health-care costs more generally are skyrocketing.
We need to stop talking about Medicare as if it is separate from the larger health-care system and look to it as a solution for the failures of the private insurance industry. With nearly 50 million Americans lacking insurance and private insurers damaging the profitability of American businesses, it is clear that private insurers are not the solution to rising premiums. They are the problem.
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