Karl Rove thinks Republicans need a more “populist” narrative on Medicare (emphasis is mine):
A good starting point is Mr. Ryan’s message from his speech at the Economic Club of Chicago that his Medicare reform package “makes no changes for those in or near retirement, and offers future generations a strengthened Medicare program they can count on, with guaranteed coverage options, less help for the wealthy, and more help for the poor and the sick.”
The populist note is especially important: When he starts receiving Medicare, Bill Gates should bear a greater share of his health-care costs than the less healthy or less wealthy.
In other words, Republicans need to lie. Not exactly a shocking recommendation from the likes of Karl Rove.
The Ryan plan does not “strengthen” Medicare for “future generations.” The Ryan plan destroys Medicare for future generations by turning it into a voucher program — oh, excuse me, a “defined contribution” plan — that would pay private insurers a fixed amount and make seniors pay for the rest. Ryan touts the “defined contribution” line as if paying the insurance plan directly somehow eases the sick individual’s cost burden more than a voucher sent directly to that individual would. But if the amount the government pays is grossly inadequate to the actual cost of medical care — especially for a population group that tends to have more frequent and severe health issues to begin with — then the burden is not eased.
Even supporters of Ryan’s plan end up making arguments meant to be in its favor that are so transparently dishonest that a fourth-grader could pick them apart. Here is Shawn Tully, at CNN Money, attempting to sound “balanced” while making the plan sound like a winner (emphasis is mine):
The centerpiece of the Ryan manifesto is the radical new math it applies to Medicare benefits. In short, Ryan (R-Wis), chairman of the House Budget Committee, would transform the program for Americans ages 65 and older from an open-ended entitlement that threatens to swamp the budget into a system that makes fixed payments to participants each year — payments that would rise at a predetermined, predictable rate. In concept, it’s similar to the defined contribution plans most Americans now depend on for retirement: The government would provide a set dollar payment towards your health care premium, and you’d cover the balance of your health care costs, just as most Americans need to take extra savings from their paychecks for retirement.But while you can pretty well predict what your 401K will be worth in 30 years if you invest conservatively, the outlook for tomorrow’s Medicare enrollees is far less predictable. The Ryan budget tells us how fast federal spending on Medicare will rise — far more slowly than in the past — but can’t predict how high our medical costs will be 20 years from now, and since the government’s contribution would be capped, how much of those costs we’ll need to pay for ourselves.
In effect, Ryan is asking Americans to make a historic leap of faith. He projects that the newly cost-conscious customers, who’ll inevitably be spending more of their own money, will shop far more carefully for health care. The pressure from those bargain-hunters, and the end to a regime that pays for as many tests as doctors can order, will force physician groups and hospitals to become far more efficient, and offer better prices.
“It’s very speculative how the new system would work,” says Robert Moffitt, a health care policy expert at the conservative Heritage Foundation. “But we know for sure that the Ryan plan would force private providers to compete ferociously for business, and that would introduce a degree of competition into Medicare that’s totally absent today.”
Even without the guffaw-inducing “It’s very speculative… but we know for sure,” it’s hard to take the Heritage Foundation and its adherents seriously on this idea that the “free market” is going to swoop in and save the day for seniors cut off Medicare. Given the fact that the vouchers would be so low relative to the costs involved, it’s much more likely that private insurance companies would drop the senior market altogether than that they would “compete ferociously” to offer policies for the contribution amounts the government would be paying them.
And then there is the other dishonesty that Ryan and his fans are putting out about his plan — that it would work the same way as the health care program that members of Congress and other federal employees get. This is not exactly a lie, but it’s misleading — as the New York Times‘s Economix blog points out:
There is a huge difference in one important aspect between the Medicare program in the Ryan budget plan and the Federal Employee Health Benefit Plan, or F.E.H.B.P., for federal employees and for members of Congress.
Basically, the F.E.H.B.P. is best described as a typical employer-sponsored health insurance plan. The federal government’s – that is, taxpayers’ – annual contribution to the premiums paid to competing private insurers by employees and members of Congress would rise in step with the average premiums charged by the private insurers (see Page 1).
These premiums have been rising over time more or less in step with the overall increase in per-capita health spending in this country.
By contrast, under the Ryan plan, the federal contribution toward the purchase of private health insurance by future Medicare beneficiaries would be indexed only to the Consumer Price Index (see Page 2 of the C.B.O. analysis).
Over the last three decades, the C.P.I. has grown at a much slower rate than per-capita health spending, especially since 2000. …
The problem with the Republicans’ message on the Ryan plan is that people have gotten it:
That support is eroding is not surprising when we consider that initial support was built on the following three pillars:
One pillar was the true believer, a group made up of persons ideologically predisposed to like any program that contains such concepts as vouchers, market forces, and block grants (not to mention tax cuts). I know, because not only is this the obvious constituency but also because there would have been a time that I would have reacted in an automatically positive fashion to all of these buzzwords (I have, however, grown skeptical of their magic over the years in this policy area).
The second pillar was hope. A lot of people were initially hopeful that the Ryan Plan was a truly serious policy prescription that could deal with our most pressing long-term fiscal problem, i.e., Medicare. Of course, the irony that people who made a lot of fun of all things hopey-changey would be so vested in hope-based policy ideas should not be lost. …
The third pillar was courage.* We were told by almost anyone who spoke of the Plan (including the dreaded liberal media) that Ryan’s Plan was “courageous” (or some other superlative). As such, it is hardly surprising that initial responses to the Plan were largely positive. And, I will state, that Ryan does deserve some credit for making an actual policy proposal and I would encourage more attempts in that realm. Fundamentally, it was always going to be the case that the Plan was going to start out at the apex of its popularity and then decline from there. Why? Because the initial press was a combo of hope and courage, with promises of saving to boot. What’s not to like about that? Answer: the actual details of the Plan.
Now, pillar one remains in place.
Pillars two and three, however, are taking serious hits because people are starting to learn more about the Plan’s contents.
There are legitimate questions that call the Plan into question from a policy perspective and there are two key ones. First, the Plan substantially restructures Medicare and changes it from a clearly defined, guaranteed benefit to a more nebulous program. Yes, seniors would be guaranteed a voucher, but they are on their own from there. Second, apart from hope (back to that word) that market forces and state-run (via block grants) programs will lower costs, the Plan does not directly address the health care cost question, which is at the heart of the need to reform Medicare in the first place.
So, in other words, the Plan does not promise the same level of benefit that the current program does and it fails to deal with the cost issue.
Is there any surprise, then, that the Plan’s approval numbers are falling?
And, btw, have I mentioned lately that Medicare is a wildly popular program, amongst Democrats and Republicans? That might be part of the Plan’s trouble as well.