The Congressional Budget Office estimated that Ryan's proposal from last year would require a typical 65-year-old to pay a lot more for Medicare by 2030. His latest plan is missing key details, so the CBO has been limited in its analysis.
Although Ryan would give future seniors the option of remaining in the traditional, government-run Medicare program, it would have to compete with private plans. Critics predict that traditional Medicare could become unaffordable if it attracts the sickest people while private plans lure the healthiest. They also say that beneficiaries might have trouble finding physicians if they abandon the program because their rates are cut.
Obama is a critic of premium support: His ideas are rooted in the health law, and would retain Medicare's existing structure. Currently, the government runs the program on a defined-benefit basis, meaning that the government will pay whatever it takes to cover a specified set of services. A quarter of beneficiaries are enrolled in private Medicare health plans, although they don’t compete with the traditional program on price, as they would under Ryan's plan.
Q. What's next for Medicare?
The House Ways and Means Committee conducted a hearing April 27 on the premium-support concept, but lawmakers are unlikely to consider legislation that would restructure Medicare in any significant way until a new Congress -- and possibly a new president -- are seated in 2013. Still, after the elections, Congress may try to pass budget-reduction legislation that would avert automatic 2 percent cuts in Medicare required under last year’s budget agreement. In the meantime, Medicare is proving to be a contentious issue in presidential and congressional campaigns nationwide, as both parties vie for the coveted senior vote. Behind the scenes, stakeholders -- from seniors' advocates to insurance leaders -- are working to produce proposals that protect Medicare and their interests.
This story was reprinted from kaiserhealthnews.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communications organization not affiliated with Kaiser Permanente.