For Republicans, Obamacare is the gift that keeps on giving. Each day brings a fresh batch of horror stories of people losing their plans, getting cut off from their doctors, and shelling out more for premiums.
But had Mitt Romney won in 2012 and let Paul Ryan have his way with Medicare, Republicans would be on the other side of the fence, trying to defend a health care overhaul that produced a nearly identical suite of horror stories.
That’s because, despite the political chasm between them — and though neither will admit it — Obama and Ryan are pushing similar policies in the bid to change the U.S. health system. Both rely on private insurance, sold through a competitive exchange, with help from a government subsidy.
And though they apply it to different populations, both programs share a fundamental conceit: They move a big group of people into the private insurance market. Both Obama and Ryan argue their overhaul would improve the country as a whole, but neither can escape the reality that in a shift of that size, some people will lose out.
And each plan’s losers would have similar stories to tell.
Some premiums will go up
Insurance companies cut back on coverage or limit provider networks to keep premiums low. Lower premiums also will usually come with higher deductibles. This is pretty much how private insurance works, and that will be the case whether Obama or Ryan is expanding the market for private insurance.
The Congressional Budget Office has said seniors’ costs would be higher under Ryan’s model, though it has declined to provide a specific estimate, in part because the plan hasn’t been introduced as a bill.
A Ryan-like plan that immediately affected current seniors would raise seniors’ premiums by an average of 30 percent, and their total spending — including premiums, deductibles, and other cost-sharing — by about 11 percent, according to CBO.
CBO’s estimate isn’t an exact comparison to the Ryan plan, because it assumes changes would affect current beneficiaries — which Ryan’s plan wouldn’t. But liberal health care experts pointed to the report as an indication of how the Medicare program would be different once a policy framework similar to Ryan’s was fully in place.
The House Budget Committee, which Ryan chairs, did not respond to a request for comment for this story.
Some people can’t keep their doctors
Republicans have assailed the Affordable Care Act because many of the plans offered through its exchanges use narrow networks of doctors, hospitals, and other health care providers. Conservatives sharply criticized the White House after Zeke Emanuel, a former health care adviser, said that if you like your doctor, you can pay more to keep your doctor.
But, again, the same basic trade-off applies under the Ryan Medicare plan. The Ryan plan guarantees that seniors will have a subsidy big enough to buy a health care plan. But in most parts of the country, it won’t be enough to buy traditional Medicare.
So, in order to choose that program — and its extensive provider network — seniors would have to make up the difference out of their own pocket. They could pay more for the plan that exists today, or they could switch to a cheaper private plan that would likely offer a smaller provider network, meaning they might have to change doctors.
Premiums for traditional Medicare would cost seniors about 56 percent more than they pay today, under the accelerated scenario CBO analyzed. About half of Medicare beneficiaries would buy private plans and half would remain in traditional Medicare, under CBO’s model.
Losers, but different losers
Obamacare and the Ryan plan are similar, but it’s important to remember their respective starting points. Obamacare is primarily covering people who have never had insurance before, and also requiring some people (no one knows exactly how many, but it’s somewhere in the millions) to buy new policies. Ryan, meanwhile, would overhaul an existing program.
“With Medicare, you’re talking about the whole 40-plus million beneficiaries who are going to have to make new choices and whose benefits and premiums are likely to be affected,” said Paul Van de Water, a senior fellow at the Center on Budget and Policy Priorities, which opposes Ryan’s model for Medicare.
From a cost perspective, that means the Ryan plan has one especially big winner: the federal budget. The purpose of Ryan’s plan is to cut federal entitlement spending, and it would do that. Overall costs, combining federal spending and seniors’ costs, would also fall.
Obamacare launched a new stream of federal health care spending while the Ryan plan would shrink an existing one. That’s a big difference. But both options would expand the market for private insurance, and therefore would expose millions more people to narrow networks and the other standard trade-offs of the insurance market. Both would inevitably mean some degree of sticker shock for certain people, and paying a lower price would mean giving up benefits.
“How it all works out is complicated, but that’s another point of comparison with health reform,” Van de Water said.