Tag: health care

by LIZ HALLORAN

Original Article here 

Since GOP presidential candidate Mitt Romney picked Rep. Paul Ryan of Wisconsin as his running mate, seems all we’ve been hearing about is Medicare and its future.

No surprise, of course: Ryan is the author of the GOP budget plan that would dramatically remake how the health care insurance program for seniors is managed and funded. He also calls for big changes to Medicaid, the insurance program for the poor, including elderly Americans who have exhausted their means.

President Obama’s health care overhaul legislation also has significant changes in store for Medicare to secure estimated savings of $716 billion over the next decade. And the legislation calls for a broad expansion of Medicaid.

And Romney? He has sort of embraced Ryan’s plans, calling their proposals "the same, if not identical." He has, however, distanced himself from a part of Ryan’s plan: the part that finds Medicare savings over time equal to those embedded in Obama’s health care law — $716 billion.

Here’s a look at the programs the candidates are selling and their different paths toward reining in the massively expensive and rapidly expanding programs.

MEDICARE

What Is Medicare?

It’s the federal health insurance system for people age 65 or older, certain younger people with disabilities, and people with permanent kidney failure that requires dialysis or a transplant. The system has 47.6 million beneficiaries; in 2009, 9.3 million of those beneficiaries were also eligible for Medicaid.

In 2011, Medicare cost the federal government $551 billion. It has four parts:

Part A: Hospital insurance that covers inpatient hospital care, as well as skilled nursing facility, hospice and home health care.

Part B: Medical insurance that helps cover the cost of health care provider services, outpatient care, durable medical equipment, home health care and some preventive services.

Part C: Known as Medicare Advantage, it offers, along with coverage under Part A and Part B, additional health plan options provided by private insurance companies, as well as prescription drug coverage under Part D.

Part D: Coverage that helps pay for prescription drug costs, run by Medicare-approved private insurance companies.

Why do we keep hearing the amount $716 billion?

That number has become the focus of debate about whose Medicare plan would do what in terms of saving money and/or cutting services. It comes from the nonpartisan Congressional Budget Office. The CBO has estimated that if Obama’s health care law is repealed, as advocated by Ryan and Romney, Medicare spending would increase by $716 billion between 2013 and 2022.

What are the differences between what Ryan and Romney have proposed, and what’s in Obama’s health care law?

Obama: The president’s health care law preserves the current Medicare system of guaranteed benefits, and closes the prescription drug "doughnut hole" coverage gap that affects some senior citizens.

The Obama campaign characterizes the law’s $716 billion as savings largely realized by slowing the program’s growth with a decade of agreed-to reductions in hospital, private insurance and drug company reimbursement rates; and cutting reimbursements to private Medicare Advantage plans. The private-market Advantage plans were intended to manage or lower the cost of insuring senior citizens through market competition; they ultimately cost more on average than the standard Medicare plan.

Obama has asserted that projected savings embedded in the health care law plan would keep Medicare trust fund solvent until 2024; however the legislation uses savings to subsidize health insurance for younger people.

Romney: His campaign’s most recent statement on the issue read like this, as reported by NBC News: "A Romney-Ryan administration will restore the funding to Medicare, ensure that no changes are made to the program for those 55 or older, and implement the reforms that they have proposed to strengthen it for future generations." Romney has, in the past, supported Ryan’s plan.

Ryan: Ryan has proposed a system that would go into effect when people now age 55 and younger hit retirement age.

For those future senior citizens, Ryan has proposed to remake the current system that provides a guarantee of benefits. Under his plan, the government would issue credit vouchers to eligible recipients. They would purchase their own insurance, using the vouchers to defray the cost.

The CBO has estimated that changes proposed in the Ryan plan could push up out-of-pocket insurance costs for an average senior citizen by $6,400; advocates of the plan argue that market forces will drive down insurance costs. Rest of story here…