Voted down 57-40 in the Senate today, largely due to the perception the GOP/Ryan plan for Medicare is bad for Seniors, it also played a part in the NY 26th Congressional election yesterday, where a Democrat upset the Republican candidate, for the long time GOP held seat. It will remain as a place holder or an alternative so that the GOP can say, "...look, we've provided a better idea, a better plan. We just need to sell it to the American people and they'll join us in repealing Obamacare."
Even if somehow the Senate approved it down the road, President Obama would not be inclined to just roll back his single biggest policy achievement. Not gonna happen.
Anyway, here's the difference between vouchers and premium support...
Vouchers are a flat payment to seniors with an amount that's adjusted by the consumer price index. If the index goes up, the payout goes up. If it drops, so does the payout. Seniors would be expected to use this money, sent to them from the Federal Government to buy private health insurance.
Premium Support are payments made directly to the insurance companies on the senior citizen's behalf. These amounts are indexed to average health care costs.
Its important to note that the Ryan Plan would replace Medicare with a voucher indexed to the consumer price index. For the last 30 + years, health care costs have risen higher and faster than the CPI has risen, by about 4% annually.
To add to the confusion, what Congressman Ryan calls Premium Support is really closer to the definition of a voucher system.
Over time, if Seniors have to pick up the additional 4% in health care costs, it will be a hardship for that population that have the smallest means to afford the extra expense. For example, the Ryan Plan would give seniors $8,000 in 2022 to pay for their insurance. If for some reasons health premiums rise dramatically, seniors would be stuck paying the difference between the $8,000 and whatever the premiums wound up costing. As the Congressional Budget Office commented, "the share of health care expenses that a typical elderly beneficiary would have to pay out of pocket would go up in 2030—from 25-30 percent under current law, to 68 percent under the Ryan plan.”
Further, the health care economist who originally designed premium support, Henry Aaron, points to the fact that the Ryan Plan calls for insurance exchanges for seniors and the disabled, while in his and his party's call to repeal the Affordable Care Act (i.e. "Obamacare") which offers insurance exchanges for the younger, healthier and non disabled population. It is much riskier to form an exchange for the worst risk/highest cost pool imaginable.
"Vigorous supporters of market-based controls on health spending should start where chances for success are greatest. That means proceeding resolutely to implement the Affordable Care Act, not repeal it, and to wait for radical change in Medicare until we see how the new system works."
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