Why you can’t afford Paul Ryan’s Medicare plan
Have you been watching the mental gymnastics that the Republicans have been engaging in since voting to pass Congressman Paul Ryan’s budget last month? This week, the solidly Republican 26th U.S. Congressional District in the State of New York rejected the GOP candidate and sent a Democrat to Congress in a special election. Some on the GOP side – including Congressman Paul Ryan – are saying it’s because they don’t understand his Medicare proposal. I’m saying it’s because they do.
Every year, many employees receive a statement from their employers that breaks down the cost of benefits, including the total cost and the share paid by the employee and the employer. Perhaps a lot of people don’t spend much time reading those things, but I always do – and it will tell you in black & white exactly why most people are going to lose a LOT of money under Ryan’s plan. And for most of them, it’s money that they won’t have.
First, while the Republicans have done everything they can to try to excise the word “voucher” from being used in connection with the program and their latest euphemism is “premium support,” it doesn’t matter what you call it. The problem is that it isn’t near enough to cover a decent health insurance policy. A really good health policy runs well north of $10,000 annually for an individual now – more than $20,000 for a couple. And that’s for working people. I’m not even going to get into the fact that the group we’re talking about is past retirement age and so the costs are much higher. I’m not even sure that many people know what the cost would really be in the private insurance market, since these folks are on Medicare right now and the policies that they buy are supplemental. Medicare doesn’t need to make a profit, but private carriers certainly do.
Ryan’s plan would give you a voucher – oops, I mean “premium support” — in an amount that falls short of the value of a Medicare policy and it is a gap that will only grow. Rises in the cost of health care have led inflation for as long as most of us can remember, but Ryan proposes that the value of the voucher should only track general inflation. There would be additional administrative costs and profit to the insurance carriers to consider, because they are inherent in Ryan’s plan. There’s also a fundamental issue and that is the problem of who wants to insure a group of people who are often sick and disabled.
Let me make this simple for you: the Ryan plan will leave you paying for at least half of your health care costs – via insurance or out-of-pocket – in your golden years, when your income is lowest and your health care costs are highest. If you don’t have an extra $182,000 to throw at these new costs that will be factoring in over the course of the average retirement span, then you are going to be in deep kimchi. (I didn’t make that number up. It was calculated by the Center for Economic Policy Research for a person born in 1957 and if you’re younger, you will need more than that.)
Ryan thinks you should care more about the federal budget than you do about your own, but he still finds plenty of money to extend tax cuts to the uber-wealthy because that’s what is important to people like Mr. Ryan. (In fact, most of Congressman Ryan’s budget cutting doesn’t go to reduce the deficit or the debt. It’s about tax cuts.)
Really rich people don’t care about this stuff because an extra $500, $1,000 or even a couple of grand a month is not a big deal. Dick Cheney says he ‘worships the ground that Ryan walks on.’ Congressman Sean Duffy – who is struggling along at $174,000 a year* — has already voted for this plan. (Things look different if it takes you less than six years to make a million dollars instead of most of your career.) Millionaire Tea Party Senator Ron Johnson voted for it, too. GOP Presidential hopeful Tim Pawlenty says he would sign it, along with others in that cast of a dozen or so.
But stuff like this bankrupts middle class people and those further down in the food chain. Even Newt Gingrich characterized it as ‘radical’ and ‘right wing social engineering’ — until he got taken to the woodshed for that unacceptable moment of candor. And the people of New York’s 26th Congressional District didn’t even want to deal with a representative who might support it, so they sent a Democrat to vote no – even though most of them are Republicans, themselves.
New York Times: Rep. Ryan’s dubious sales pitch —