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Ryan’s Medicare: Poison for seniors

By Will Parry

In the May issue of The Retiree Advocate, PSARA President Robby Stern summarized the many ugly specifics of Paul Ryan’s proposed budget for 2013 – a budget endorsed by Mitt Romney.

In this article, we single out an aspect of that budget of critical importance to today’s seniors – and tomorrow’s.  Our focus is on Medicare.  We’ll spell out exactly how the Ryan budget would undermine Medicare’s protections, callously shifting health care costs to the older men and women who rely on it.

The beneficiaries of Ryan’s scheme?  The big health insurance companies, the pharmaceutical giants, the medical device makers – in short, the powerful medical-industrial complex.

Ryan has now shelved his proposal of last year for the outright privatization of Medicare.   He would still offer seniors a voucher, capped at a harshly inadequate rate, for use with a private insurer.  But he would leave Medicare in place as an option that seniors could choose.

This would enable health insurance companies to cherry-pick younger and healthier seniors off Medicare into their appealingly-structured private plans (subsidized by the taxpayers).  The sicker seniors would then be marooned in an ever more costly Medicare program.

As George Zornick wrote in The Nation, “This is ironically perhaps a better deal for the health insurance industry than total privatization.  They don’t have to deal with the expensive, unhealthy elderly folks.”

The Congressional Budget Office (CBO) estimates that, under the Ryan scheme, seniors’ annual health care costs would be $1,200 greater by 2030, and $5,900 greater by 2050.

But that’s not all.  The Ryan plan would raise the age of eligibility for Medicare coverage by two months per year, beginning in 2023 and continuing until reaching age 67 in 2034.

This two-year delay in eligibility isn’t mentioned anywhere in Ryan[s 99-page budget document.  You have to go to the CBO report on the budget to find it.

During the two years from age 65 to age 67, seniors, being not yet eligible for Medicare, would confront the higher out-of-pocket health care premiums, deductibles, co-pays and coverage limitations typical of the private insurance market, chiseling away at their Social Security checks.

“The Republican Party intends to raise the Medicare age for people as they approach the costliest years for receiving health insurance, and they’re keeping it a secret from the public,” Zornick wrote.

Moreover, under the Ryan plan the private insurance industry, and not the federal government, would determine the level of expenditures for senior health care. Here’s how it would work.

All private insurance plans would participate in an annual competitive bidding process.  The second lowest bid would establish what the  government would pay for health insurance.

But private insurance rates have been climbing at three and four times the rate of today’s Medicare.

The insurance industry has shown no ability to restrain cuts – and has no motive to do so. With budgetary control over this major government program in the hands of the very insurance companies that profit from it,   Medicare as we have known it would be history.

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