Without detailing his exact view of how he would change Medicare, he cast the GOP proposal to convert the program into one in which people get vouchers to buy insurance as a plan that would “end Medicare as we know it.”
Medicare is an actuarially flawed program. The taxes collected from employees and employers is less than what it pays out. According to the New York Times, in 2009 it was estimated that Medicare would start running out of money by 2014. But that was before Obamacare rescued the program by slashing $500 billion of its future outlays. And how do you reduce the rate of payments? Experts will chose how much health care providers will be paid. Specifically, the Independent Payment Advisory Board will be empowered with the ability to lower costs. As Nobel Prize winner Paul Krugman puts it:
To keep spending at or below this target, the board would submit “fast-track” recommendations for cost control that would go into effect automatically unless overruled by Congress.
Feel better now? Experts will have perfect knowledge about how health care should be delivered. Perhaps they would decide which procedures are appropriate for loyal party members of a certain age. Think of how much money they could save if we only gave new hips to dues paying union members, or heart surgery to loyal Democrats.
The fact is that we can’t keep Medicare as it is. It’s broke. We are only arguing about how to transform it. Obama wants the experts to ration, and Ryan wants individuals to chose the type insurance they prefer. Do you trust 50 million consumers making their own financial decisions, or a dozen carefully chosen experts? What could go wrong?