Republican presidential candidate Mitt Romney and his vice presidential pick, Rep. Paul Ryan, at Aug. 13 rally. (Photo credit: mittromney.com)
The newly minted Republican ticket of Mitt Romney and Paul Ryan is placing a big -- and some might say cynical -- bet that the stereotype of the "greedy geezer" is real, that Americans now eligible for Medicare or close to it don't care that the popular health program won't be there for their children and grandchildren.
In picking Rep. Ryan as his vice presidential running mate, Romney has taken on Ryan's plan for replacing Medicare for senior citizens with a voucher program that will end the current fee-for-service program and shift more of the financial burden for health care onto Americans after they turn 65.
However, as Romney and Ryan quickly explained in a TV interview, the Ryan plan wouldn't affect people currently on Medicare. In its current form, Ryan's plan for turning Medicare into a voucher system (or "premium support" as Ryan calls it) wouldn't begin until 2022.
Since senior citizens vote in higher percentages than other demographic groups, Romney and Ryan are trying to split the current Medicare recipients away from those Americans in later generations. The reasoning goes: If today's seniors think that they'll still get theirs, they won't care that their kids and grandkids might be stuck with an inferior program costing each one more than $6,000 extra.
Last year, when Ryan's was pushing his Medicare overhaul, he and other advocates specifically stressed to seniors at town hall meetings that they would continue to get the system's guaranteed benefits, an explanation that drew applause from some voters in that age group but prompted concerns from others.
For instance, in Elkhorn, Wisconsin, 64-year-old Clarence Cammers hesitantly asked Ryan a question that got to the heart of the matter. After describing himself as a disabled veteran living on Social Security, Cammers said he could stand some cutbacks for himself; that wasn't his concern.
"I will be fine," Cammers said. "I guess what I'm saying is, what are all these changes going to mean for my son?"
Cammers was noting the hard truth that it would be younger Americans who would face Ryan's scheme of replacing Medicare with government vouchers that would fall short of covering the costs of private insurance.
Pleasant Language
Though Ryan inserted some pleasant language promising that the sick will get adequate care, the reality is sure to be different, essentially requiring the elderly -- many who will have preexisting conditions -- to navigate through a complex system of insurance companies offering varying levels of coverage. Plus, many insurance companies don't want anything to do with old and sick people.
As the Brookings Institute's Henry Aaron explained to the Washington Post's Ezra Klein, "We've all heard about the great proportion of health services used by people in the last year of life. That means if you're an insurer, you want desperately to not enroll those people. That means you need to try every marketing device you can not to get stuck with the sickies."
Indeed, the projected budget savings from Ryan's "premium support" system would be derived from the shortfalls between the vouchers and the cost of medical care for seniors. In other words, the money would be taken out of the pockets of the elderly or be saved by them skipping treatments that they otherwise would receive.
Even for current and near-term Medicare beneficiaries, the Republican plan would have that effect for people needing lots of prescription drugs. The Ryan plan would repeal the current subsidy for seniors facing the "doughnut hole" gap in drug benefits.
But the hardest impact of the Ryan plan would hit those turning 65 in 2022 and later. Though Ryan's sketchy 2011 proposal lacked many of the specifics needed to fully evaluate its effects, a New York Times editorial noted, "there is little doubt that the Republican proposal would sharply reduce federal spending on Medicare by capping what the government would pay at very low levels. "
"The Congressional Budget Office estimates that by 2022 new enrollees would have to pay at least $6,400 more out of pocket to buy coverage comparable to traditional Medicare. Huge numbers of Medicare beneficiaries live on modest incomes and are already struggling to pay medical bills that Medicare does not fully cover. We should not force them into private health plans that would charge them a lot more or provide much skimpier benefits."
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