Debt Panel Members Propose Medicare Becoming a Voucher Program
Two members of President Barack Obama’s debt commission have proposed converting Medicare into a voucher program in a bid to slow the growth in health-care costs.
The plan, by Wisconsin Republican Representative Paul Ryan and former Congressional Budget Office Director Alice Rivlin, would create a program in which those turning 65 after Jan. 1, 2021, would receive a fixed payment from the government to purchase health insurance instead of enrolling in Medicare. Those currently aged 55 and older would continue to participate in traditional Medicare.
The proposal -- which Democrats on the commission would likely oppose -- takes aim at the administration’s health-care overhaul enacted earlier this year by repealing provisions that set up a program to offer long-term care insurance. It also would cap spending on Medicaid, the federal-state health-care program for the poor, and clamp down on medical malpractice lawsuits.
The Congressional Budget Office gave the proposal a preliminary estimate of $280 billion in savings over 10 years.
Seniors would likely pay higher costs and receive fewer benefits because “future beneficiaries would probably face higher premiums in the private market for a package of benefits similar to that currently provided by Medicare,” the CBO also said.
The debt commission is considering a budget-cutting plan by co-chairmen Erskine Bowles, former chief of staff to President Bill Clinton, and Alan Simpson, a former Republican senator from Wyoming, that calls for almost $4 trillion in overall savings over the next 10 years. On health care, federal spending would be limited to the rate of economic growth plus 1 percentage point, though few details on achieving that goal are provided.
Rivlin and Ryan, who head the panel’s working group on Medicare, said in a summary that “we aim to show a path to achieving the co-chairs’ goal” and “to demonstrate that Republicans and Democrats can come together to reform entitlements.”
The commission is slated to discuss the proposal at a closed-door meeting tomorrow. Any plan would have to be approved by at least 14 of the panel’s 18 members before it could be forwarded to the Senate for a vote. The commission’s recommendations are due Dec. 1.
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