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Could 2013 be a year of change on Medicare?

Hours before the full House voted on their respective budget plans, House Budget Committee Chairman Paul Ryan (R-Wis.) and Rep. Chris Van Hollen of Maryland, the committee's ranking Democratic member, discussed entitlement reform, premium support and reasons why it's possible that 2013 could be a year for legislative action on Capitol Hill.

I caught up with both congressmen after they spoke about their financial blueprints to a crowded audience at a policy summit Thursday hosted by the National Journal. Ryan's budget plan—introduced last week—passed in the House today, but the bill is not expected to go beyond the lower chamber.“The Senate's not going to do anything,” Ryan said. “If the Senate's not going to pass a budget, then you don't have reconciliation; then you don't have an entitlement reform; and it's another missed opportunity,” he said. He also reiterated what Sen. Ron Wyden (D-Ore.) told attendees at the Federation of American Hospitals annual meeting earlier this month: that the two lawmakers released their Medicare reform plan in December as a way to initiate conversation on the issue this year. As he explained, there is growing support from both parties to address entitlement reform.

“What we're trying to do is show, how in 2013, a bipartisan consensus can be reached at,” Ryan said. “And tax reform's like that too. We think there's a bipartisan consensus emerging on tax reform and Medicare reform. And my hope is to work with others on all of the other issues to get that going—get that germinating.”

From Van Hollen's viewpoint, 2013 could produce results in Washington because of what he called three “action-forcing events”: the expiration of the George W. Bush-era tax cuts, the looming automatic budget cuts and the debt ceiling, which the country is scheduled to hit by year's end. “It's a very combustible cocktail,” Van Hollen said during the question and answer segment, “but it also has the potential to force people to make the difficult compromises.”

Later, the Maryland Democrat explained to me what he finds most disconcerting about Ryan's premium-support model—namely, that the voucher system in the House GOP budget does not keep pace with the rising costs of healthcare. And what about the Wyden-Ryan plan, which places traditional Medicare as a choice alongside private plans?

“We have today fee for service and we have Medicare Advantage,” Van Hollen replied. “We have private plans within Medicare today. They're carefully regulated to avoid cherry-picking because if you don't do that, you run the risk of having the healthier seniors migrate into the private plans,” he added. “Medicare then becomes must more expensive and you get the insurance death spiral and that's a real problem.”

Follow Jessica Zigmond on Twitter @MHJZigmond
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