To make his Republican budget more politically palatable, Paul Ryan decided to go with an age-based “divide and conquer” strategy. He promised to keep Medicare intact for those currently on it and those above 55, and will only turn it into a privatized voucher program for those under 55.
The Third Way, with whom I rarely agree, does makes the interesting point that, in reality, Ryan’s plan doesn’t actually protect current seniors Medicare. With no new people joining traditional Medicare, its pool would steadily shrink, making doctors less willing to accept it.
The traditional Medicare plan, which covers three-fourths of today’s beneficiaries, relies on its huge size to keep costs down. Doctors and hospitals are not required to participate in it, but they have little choice if they wish to treat any seniors, who are the nation’s biggest health care consumers.
Fewer doctors would participate in the traditional Medicare plan if there were an alternative. The traditional plan pays physicians about 20% less than private health insurance plans. Today, that is essentially a discount for the large volume of Medicare patients. Under the Ryan budget, it would become a reason for doctors to leave the traditional plan.
Despite the promise that people on Medicare will have their current insurance protected under Ryan’s plan, as they got older, the quality of Medicare’s coverage would actually get much worse.