GOP Budget Chairman's 2012 Budget will Drastically Cut (and Radically Change) Medicare

On Tuesday, Wisconsin Representative Paul Ryan, chair of the House Budget Committee, unveiled his 2012 budget proposal which includes radical changes that would privatize Medicare, hurting seniors and enriching insurance companies.

(Note: Just to clear up any confusion, Paul Ryan’s 2012 budget is not the same as the 2011 budget that we’ve talked about on this blog and that has been getting many headlines recently. The 2011 budget currently being debated will fund the government through September 2011, at which point Congress must approve a new budget that will lay out funds for the government between September 2011 and September 2012. That new budget for September is the budget that Paul Ryan has just unveiled.)

Paul Ryan’s plan would end Medicare for all Americans under 55 years old. That beloved program would be replaced with “premium support” payments to insurance companies that will lower the cost of private insurance for seniors. In order to save money for the federal government, Ryan would then cap the amount that these payments can grow. To sum up, Ryan wants to end Medicare by forcing seniors onto the private market and then slowly take away the government support for their health care, leaving seniors vulnerable to increasing health care costs.

Ryan and other tea party conservatives expect that costs will fall when seniors are forced to pay out of pocket for their health care needs. But as we’ve documented before on this blog, out of pocket payments don’t lower health care costs. Instead they force those with lower incomes to stop taking needed medications and avoid preventative care in order to save money. In the end this leads to higher costs as expensive procedures are needed to fight diseases that could have been treated cheaply if caught early and managed properly.

The other problem with Ryan’s plan is that it’s not just Medicare costs that are rising but its health care costs in general. Medicare actually provides cheaper care than private insurance due to low administrative costs. Pushing seniors off of Medicare and onto the private market keeps costs low for the government, but it does so by shifting the burden to seniors. President Obama’s health care reform found cost savings in Medicare by cutting subsidies to private insurance companies and by proposing doctor payment and insurance reforms that will provide more efficient care with similar, or better, health outcomes. Ryan’s plan will increase subsidies to private insurance and find savings by sacrificing senior’s access to care.

These drastic cuts will surely come as a shock to those that voted in 2010 for Republican candidates that campaigned aggressively against cuts to Medicare. Indeed, even many Republican are now trying to distance themselves from this plan. In February, after Ryan floated an earlier version of this proposal, Republican House Speaker John Boehner accused Democrats of falsely calling this proposal the official Repulican proposal:

"Paul Ryan, who's the ranking member on our budget committee, has done an awful lot of work in putting together his roadmap," Boehner said. "But it's his. And I know the Democrats are trying to say that it's the Republican leadership. But they know that's not the case."

Now this proposal has become the official Republican 2012 budget.

-- New York Times / CWA News / Washington Post / New York Times / NPR / CWA News / CWA News / Kaiser Health News / The New Republic / Center for Budget and Policy Priorities / Washington Post / Politifact.com / Think Progress / Talking Points Memo