As congressional leaders wrangled over a host of spending issues last week, two federal lawmakers managed to release a bipartisan proposal to restructure the Medicare program.
Bipartisan Ryan-Wyden plan gets cool reception
House Budget Committee Chairman Paul Ryan (R-Wis.) and Sen. Ron Wyden (D-Ore.) together introduced a plan for the federal healthcare program that starting in 2022 would offer America's seniors a choice among Medicare-approved private plans and the traditional Medicare plan. Any private plan that participates in the program would have to provide at least as comprehensive a benefit as traditional fee-for-service Medicare, and Americans who are at or above age 55 today would not see changes in their benefit structure, according to a summary of the proposal. Instead, they would have the option of switching to a private plan after the Medicare exchange is established. That marketplace is intended to supplant the Medicare Advantage program.
The “premium support” model allows private plans to compete with traditional Medicare based on their ability to provide coverage at an affordable cost. In this new structure, premium-support levels will be determined by the cost of the second-lowest-cost plan, as well as traditional Medicare.
The Obama administration was quick to criticize the proposal, comparing it with Ryan's plan in April to privatize Medicare.
“We are concerned that the Wyden-Ryan … like Congressman Ryan's earlier proposal, would undermine rather than strengthen Medicare,” White House Press Secretary Jay Carney told a reporter at a Dec. 15 news conference. “The Wyden-Ryan proposal could, over time, cause the traditional Medicare program to ‘wither on the vine,' because it would raise premiums, forcing many seniors to leave traditional Medicare and join private plans,” he continued. “And it would shift costs from the government to seniors.”
Ryan countered that sentiment by saying he was disappointed that the president is “increasingly isolated” from what he said is a growing bipartisan consensus on ways to save and strengthen the program.
“The president's failure to offer credible solutions to the challenges facing Medicare is a disservice to seniors, a disservice to hardworking families and a disservice to the next generation,” Ryan said in a statement. “A more glaring disappointment is the president's failure to recognize a sincere effort by a Democrat and a Republican to come together and offer solutions, betraying his own rhetoric and his own commitment to those we have the privilege to serve.”
Also under the plan, low-income seniors who qualify for Medicaid would continue having Medicaid pay for their out-of-pocket expenses, while those low-income seniors who do not qualify for the program would receive fully funded savings accounts to help pay for any increased out-of-pocket costs. And if efforts to curb rising Medicare costs are unsuccessful, the plan calls for a cap on cost growth of 1% over gross domestic product, plus inflation. “Any increase over that cap will be reflected in reduced support for the sectors most responsible for cost growth, including providers, drug companies and means-tested premiums.”
When asked about the Wyden-Ryan proposal—and how it aims to replace Medicare Advantage—America's Health Insurance Plans sent a statement saying the group welcomes working with lawmakers to discuss health plans' “proven track record of providing high-quality, affordable coverage through Medicare Advantage, Medicare Part D, Medicare supplemental coverage and Medicaid managed care.”
AARP released a statement from Vice President Nancy LeaMond that said the senior citizens advocacy group is still reviewing the Wyden-Ryan proposal. “We want to make sure Medicare remains a viable and affordable option for our seniors,” LeaMond said. “At this time, too many details of the proposal lack clear definition. We need more information to comment on the proposal further.”
Reaction from provider groups was unavailable at deadline.
In an interview with the Washington Post, Ryan said: “I wanted to plant a seed this year that we can reap in 2013 when we have better (executive) leadership.” He said he felt compelled to get it out this year because next year he'll be tied up with the budget.
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