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Peter R. Orszag

Sharing Costs Is No Way to Fix Medicare

Many Republican policy makers appear conflicted about the budget plan put forward by the House Budget Committee chairman, Representative Paul Ryan of Wisconsin. They are torn because they like its substance, but believe it is bad politics, especially among elderly voters. In truth, the substance is not particularly appealing either.

At the heart of the Ryan plan is a shift within Medicare toward consumer-directed health care -– which in turn is predicated on increasing beneficiaries’ "skin in the game" to make the health system more efficient.