Last Updated:April 19 @ 07:19 am

Kerpen: Medicare - Putting Seniors Before Bureaucrats

By Phil Kerpen

Without reform Medicare will go bankrupt. So, it is not a question of "if" Medicare will be cut but "how." President Barack Obama's approach is to simply gut Medicare's funding and let the bureaucrats decide who does or doesn't receive care. Vice presidential candidate Paul Ryan's approach is to inject individual choice and competition into the program to provide more with less and to let patients, not bureaucrats, decide how to spend scarce resources. Ryan's approach puts seniors first; Obama's puts Washington bureaucrats first.

Obama has already cut $716 billion from Medicare to fund his new health care entitlement, and would cap Medicare growth going forward at the rate of GDP growth plus 0.5 percent. Those cuts will run into the trillions of dollars in the second decade under Obama's program, and will be implemented principally by turning over control of health care decisions to bureaucrats who will be empowered to deny people the care they need.

The Ryan plan implements the same cap on overall Medicare spending, but achieves it by injecting individual choice and competition into the program, allowing patients to choose between traditional fee-for-service Medicare and competing private plans.

Obama's plan — which has already been enacted — is a guaranteed disaster. If it had been Republicans who ignored public opinion and chose to gut Medicare to the tune of $716 billion over 10 years (and trillions more over 20 years) there would be no other issue in any federal election until that law got repealed. Democrats would be relentless and seniors would be up-in-arms. And understandably so, especially because about 10,000 baby boomers are now retiring every day.

Yet that was precisely what Obama's health care law did to Medicare. The media is dutifully downplaying the significance of these devastating cuts but it's actually worse than the headline number of $716 billion, up from about $500 billion already from when the president's law passed. That's because there is no credible cost-containment mechanism going forward to stay under the cap other than bureaucrats being empowered to deny seniors the care they need.

Most infamous of those bureaucratic denial-of-care mechanisms is the so-called Independent Payment Advisory Board (IPAB), a board of 15 bureaucrats who can set reimbursement rates and exclude particular treatments and cures from Medicare coverage altogether to bring overall Medicare spending in-line with the cap. And IPAB's dictates cannot be overturned even by Congress unless it musters a supermajority, a constitutionally-questionable scheme to insulate IPAB from democratic accountability. Hospitals are protected from IPAB cuts until 2020, meaning the initial cuts will hit doctors and nursing homes even harder, forcing fewer and fewer to accept Medicare patients.

Ryan's plan, on the other hand, would continue to provide benefit levels similar to what Medicare offers now, and achieve cost containment not through bureaucratic control but through individual choice and competition. Workers who are presently 55 or younger (there are no changes for current retirees or those near retirement, unlike Obama's plan) would, when they qualify for Medicare, receive a benefit equal to the cost of traditional Medicare in the market in which they live. They would have the choice of using that benefit amount — known in this plan as "premium support" — to stay in traditional Medicare or opt instead for private plans that would be required to offer coverage that is no worse than the traditional program.

A group of Harvard researchers analyzed this plan, developed by Ryan with Democratic Senator Ron Wyden of Oregon, and found that if it had been in effect in 2009 it would have saved 9 percent with no reduction in care.

So the real question is not whether Medicare will be cut. It must be, will be, and already has been. The question is how it will be cut: bureaucratic denial-of-care or individual choice? Voters who understand what's at stake will overwhelmingly favor the Ryan plan.

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Mr. Kerpen is the president of American Commitment and the author of "Democracy Denied." Kerpen can be reached at phil@americancommitment.org. © Copyright 2012 Phil Kerpen, distributed by Cagle Cartoons newspaper syndicate.

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3 Comments

  1. inluminatuoComment by inluminatuo
    August 20, 2012 @ 7:47 am

    I actually was going to wait until age 70 to begin drawing my Social Security. If Obama gets re-elected then bankruptcy of our social security will soon follow, so I will then file as fast as I can to get as many of my paid in Social Security dollars out as I can, before the inevitable worst case scenario happens. Just ask the Soviet retirees what happened to their money when the similar ideological and fiscally inept Socialist Communist government fell in the late 1980′s. History WILL repeat itself. A Vote for Romney/Ryan is a Vote for continued prosperity and retirement/medicare benefits. What Obama does not understand is that when you don’t pay now, you don’t get later,,,,,and later is now upon us.Our time to fix this is running out so first fix our leadrship now or our laters will be socialist poverty as usual.

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    • nickster99Comment by nickster99
      August 20, 2012 @ 9:55 am

      I don’t know how much I would take this as the truth but if the marxist regime and all of its minions somehow manage to get re-elected or hold a majority in Congress. The future plan is to confiscate all the pension plans, 401k’s, IRA’S and Roth IRA plans into a government controlled pension plan and everyone (and that includes people that collect welfare now) will get a pension in addition to SSS benefits. I heard there is something like 4-6 trillion dollars invested in all these plans and these commies want to get their hands on it!

      Obummer has to go in November! Vote Romney/ Ryan!

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  2. prairelivingComment by praireliving
    August 20, 2012 @ 8:48 pm

    Why are the liberals always pro-choice when it comes to killing babies but when it has to do with anything else no one is given any choice, the government is always right, and if you disagree you are racist, bigoted or some sort of domestic terrorist?

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