• Good question for Rep. Paul Ryan

    About his Medicare premium support plan, Kevin Drum asks of Rep. Paul Ryan,

    What happens if all the bidders submit bids that are over the [GDP+0.5%] growth cap? Who pays the difference? Seniors?

    If Rep. Ryan’s answer is as expressed in his white paper with Senator Wyden,

    Cost growth above the cap will be brought in line by reducing “support for the sector most responsible for cost growth, including providers,”

    then I will not be satisfied. I want to know how pressure will be brought to bear on providers when the system is operating in a more decentralized way through insurers. How do you make care provision more efficient without doing the kinds of things Obamacare is doing and Rep. Ryan rejects? How do you do it if the main tool of the government in the health sector, FFS Medicare, is less popular and has less market power, which is an outcome I expect from a premium support policy?

    The most straight-forward way to reduce the cost to accommodate the rate growth cap is to weaken the minimum actuarial requirements of plans. That’s a cost shift to seniors, and is what I’d expect to occur. But, I could be wrong. I hope someone puts the question to Rep. Ryan.


    • I would, too. And I’m voting for the GOP team.
      For the last 12 years, the cost shift has been on providers, that is, the docs. I’ve gotten about a 7% raise in 12 years on Medicare patients–and my practice is 80% Medicare. And remember, the Advisory panel has already suggested freezing doctors’ pay at the current levels for 10 more years. Hospitals have seen increases a lot higher that that over 12 years.

      IMO, it’s time the seniors do pay more of the cost. I’ve done enough. More than enough.

    • In the 1990’s, there were Medicare HMO’s that got into the system and made money early.

      All health insurance has an aging cycle, in that your insureds become much more expensive the longer they stay on your plan.

      Anyays, after a few years the HMO’s found that to meet profit targets or just stay solvent they had to charge the government much more money.
      When Medicare authorities would not pay, the HMO’s left the program and their insureds had to go back to traditional Medicare.

      To some extent all private insurance is sustained by having a safety valve in terms of somewhere to dump your most expensive patients. When private insurers have to hold onto to people over 65, then their rates really become crazy.

      The Wyden-Ryan plan is a very expensive pipe dream.