Earlier this week in New Hampshire, Republican presidential candidates touted the benefits of a Medicare premium support system — the approach to entitlement reform embraced by House Budget Chairman Paul Ryan (R-WI) and The Heritage Foundation.
Ryan’s recent partnership with Sen. Ron Wyden (D-OR) helped thrust the idea of premium support back into the national spotlight. Their bipartisan framework represented a breakthrough on Capitol Hill after liberals spent much of the year making false charges about Ryan’s plan.
Given the misleading information about premium support, let’s first take a moment to explain what it is. Heritage’s Bob Moffit and Kate Nix put it this way:
Under premium support, Medicare would become a real insurance program, not merely an outdated mechanism to reimburse specific services. Receiving fixed financial assistance to offset the cost of health insurance would permit seniors to choose the health plan that works best for them, rather than being locked into a federally defined benefits package and forced to pay a second premium for supplemental private insurance to cover Medicare’s gaps.
Pressed by NBC’s David Gregory about Ryan’s plan and the premium support model, the GOP candidates voiced approval for the approach.
Well, the fact is that the — Ryan Wyden bill, which was just introduced recently, actually incorporates allowing people to choose and allows them to stay in traditional Medicare with the premium support model, or go to new methods. And I think it’s a substantial improvement. It allows for a transition in Medicare in a way that makes sense.
Well, you know, I hear this all the time when I was — have been campaigning around — the state. You know, we should have the same kind of health care the members of Congress have. Well, that’s pretty much what Paul Ryan’s plan is. That the — the members of Congress have a premium support model. So does every other federal employee.
I mean it works very well. As — you know, the- – the federal government has a liability. They put — put money out there. And then if you want, you — you have — about this thick. If you’re an employee in Washington, D.C. it — got a — whole bunch of different plans to choose from and you have all sorts of options available to you. You want a more expensive plan, you pay more of a co-insurance. If you want a less expensive plan, you don’t.
And finally, with regards with entitlement, in the entitlement reform area, I do not want to change Medicare and Social Security for current retirees. But for younger people coming up they have to recognize that in the future higher income people will receive less payments in the premium support program.
Well, I– I said repeatedly that– we should have had a funding mechanism. And– it’s one of those things that I had a very tough vote, as you know. In that bill, we had health savings accounts, something I’d been fighting for 15 years, to transform the private sector health care system into a more consumer, bottom-up– way of doing it. We also had Medicare Advantage to transform the entire Medicare system into– Medicare Advantage is basically a premium support type model.
Well, I would have to say that I agree with the Ryan plan. I think I’m the only one standing up here who has embraced the Ryan plan. It’s a very aggressive approach to taking about 6.2 — $6.2 trillion out of the budget over 10 years. And it looks at everything. And what I like about it is it says there will be no sacred cows.
In addition to Ryan’s plan, Heritage has endorsed the premium support model as part of Saving the American Dream, a comprehensive approach to fixing the debt crisis and reforming entitlements. Last fall, Moffit outlined exactly how it would work and why it would restore Medicare solvency.