Republicans lost a House seat they had held for years in upstate New York over Rep. Paul Ryan’s radical proposal to change Medicare from a government program to one managed by private insurance companies. That proposal was part of the Republican budget reform bill passed in the House a month ago on a party line vote.
Tuesday’s special election result was significant because the campaign revolved almost exclusively around the Medi-care issue.
Calling Ryan’s plan radical is accurate. What the House budget chairman proposes is a change in the basic organization of Medicare from public to private. Rather than have the government cover the cost of providing Medicare to retirees, it would turn the re-sponsibility over to private insurance companies and subsidize part of the cost with vouchers. The size of the vouchers would depend on the income of the recipients. Those who had provided for their retirements would pay more.
Rep. Ryan continues to support his plan as a bold way to deal with the huge budget deficit, but opposition to it is growing rather than shrinking.
Here are some of its flaws:
— The non-partisan congressional budget office estimates that the average Medicare recipient would have to pay about $6,400 a year for health insurance above the subsidy provided. The cost of the plan would save the government money because so much of the cost would be shifted from the government to the elderly.
Part of the reason for the additional cost to Medicare patients is that private insurance companies are for-profit businesses. Health insurance companies are among the most profitable in the economy. Handing them the enormous Medicare account would make them even more profitable. A good chunk of those profits would come from the additional payments seniors would be required to make to have health care.
When confronted with Tuesday’s election results, Rep. Ryan said he was willing to accept changes to his proposal, but added “ … we’ve got to get into a serious conversation about what it takes to fix the fiscal problems in this country.”
Certainly — and that conversation should start with ways to bring health care costs in the United States into line with those in the rest of the rich world. Health care consumes about 17 percent of the U.S. gross national product. Most other rich nations provide health care to 100 percent of their populations for less than 11 percent of their GDPs — GDPs much larger per capita than ours. Because health care spending accounts for a large part of federal, state and other governmental spending, re-ducing health care costs would make large budget reductions possible at every governmental level.
Giving profit-seeking health insurance companies a still larger share of the health care industry would increase government spending, not reduce it.
— One of the provisions in the Ryan proposal is that those over 55 would not be affected. They would receive the same government paid-for coverage they now have for the rest of their lives.
This transparent bid for votes from today’s seniors turns off a lot of people because it is so cynical. If it is a good idea to turn Medicare over to United Health Care and its multi-million-dollar-a-year executives in 2021, why not start saving all that money right now? Well, dummy, because it would never get through Congress right now. Today’s seniors don’t want to pay $6,400 more for their health care every year. They would bury the plan so deep it would never see the light of day.
So Rep. Ryan decided to postpone the pain until another president or two and five new Congresses would have to deal with the backlash. Good politics? Not according to the New Yorkers who voted Tuesday. As a matter of fact, they may have had those slippery politics in mind when they marked their ballots.
— Rep. Ryan’s budget dealt with more than Medicare. In addition to changing that 47-year-old entitlement beyond recognition, he also proposed slashing the upper income tax brackets by another 50 percent to bring the rate down to 25 percent and offered corporations similar tax breaks. This deficit-boosting proposal gave Democrat Kathy Hochul another opening. The Republicans, she said, want to mutilate Medicare in order to give additional tax breaks to multi-millionaires and billionaires. (Wow!)
Rep. Ryan believes, despite the evidence, that tax cuts will stimulate the economy and bring the deficit down. Considering that the biggest tax cuts in history were made just a decade ago and were followed by an unbroken string of def-icits and the worst recession since the 1930s, this is a difficult argument to make and keep a straight face.
And those are only three of the reasons why Ms. Hochul won Tuesday in New York.
— Emerson Lynn, Jr.
N.B. Health insurance costs for USD 257 shot up 27 percent over last year, the board discovered Monday. Under Rep. Ryan’s plan the same thing could happen to seniors de-pending on for-profit health insurance companies for coverage. That’s not the way to go. E.L.
Medicare and tax cuts for the rich explain New York
