Yglesias goes further. He argues that, in the end, the effect of both plans on seniors will be the same. Essentially: With a voucher a la Ryan, the poor will be stuck with “bare bones” insurance because the voucher will be too small to allow them to buy something better. The affluent, meanwhile, can pay out of pocket for uncovered services. Realistically, though, only the very wealthiest can afford the thousands and thousands of dollars a serious illness can cost. Medicare beneficiaries know that, which explains why they are scared by the talk of changing the program.
Under Obama’s design for Medicare, Yglesias argues, the poor will also get “bare bones” coverage from Medicare, and richer seniors will buy supplemental policies to beef up their coverage. Iglesias doesn’t quite say why. Does he mean capping what the government spends will cause doctors to stop treating Medicare patients? Or is he arguing today’s benefits will be cut for tomorrow’s seniors?
Yglesias labels Ryan’s plan “outsourcing” to the private sector and Obama’s “central rationing.” At its core, his argument is about rationing—that thing most people believe America doesn’t do, but is the elephant in the room whenever public discussion turns to controlling medical costs. Yglesias argues:
Under either version, seniors will face the novel situation of potentially being denied useful medical treatment on the grounds that Medicare can’t afford to pay for it. Over the long term, something along those lines is likely inevitable.
That takes us into dangerous territory. As Don Berwick, the former Medicare administrator has argued for years, America needs to rationalize—not ration—the great quantities of healthcare services it consumes. We should pay only for what’s clinically effective at a reasonable price, Berwick preaches. In theory, that’s a simple idea; in practice it’s hard to implement without cries of rationing from politicians, technology sellers, and healthcare providers whose incomes are at stake.
At the end of his post Yglesias laments that we are “getting no real debate” over whether GDP+ 0.5 percent cap is the right number to curtail Medicare spending. He seems to be opening the door for a full throated discussion about this fundamental issue: Do we as a country want to want to continue unlimited spending on ineffective and expensive treatments? Or do we want to be more careful with the healthcare budget even if it means a senior may not get a treatment a doctor suggests might work or a seller of new, whiz-bang technology makes less profit?
That is his most important point. He needs to go further and lay out explicitly what’s at stake. So should other journalists.
I appreciate these corrections and clarifications. I would, however, add one more. Uwe Reinhardt has noted the warped use of "rationing." Specifically, he questioned the American habit to use the "r" word exclusively in reference to government actions, but never to describe how markets work. Markets ration health care by price and ability to pay. So, the question of "rationing" is not whether but how.
http://economix.blogs.nytimes.com/2011/04/29/does-the-ryan-plan-curb-health-spending/
#1 Posted by Shane Taylor, CJR on Mon 10 Sep 2012 at 12:44 PM
Good piece by Trudy. But this piece along with Yglesias' article fosters the misconception that it's Ryan, not Romney, who proposes a Medicare voucher plan. Romney has his own Medicare voucher proposal which closely resembles Ryan's House budget bill proposal. Romney is now trying to avoid scrutiny on this issue by putting the voucher plan off on Ryan. But he himself has proposed essentially the same plan and needs to be held accountable for it. Secondly, while Trudy alludes to the bigger elephant in the room, we should never lose sight of the fact that Medicare and Medicaid costs cannot be controlled without controlling costs in the overall U.S. health care system. The Affordable Care Act takes some steps to achieve that #comparative effectiveness research, taking steps away from fee for service payment, etc.#. Romney-Ryan have proposed only exposing consumers to higher out-of-pocket costs to get them to reduce their medical utilization, which research shows reduces both needed and unneeded services.
There are various ways that experts from both parties think could help control Medicare costs without shifting lots more costs to beneficiaries through vouchers, etc. I wish we would be spending more time discussing these possible approaches. Here's an article I wrote about this.
http://managedhealthcareexecutive.com/savemedicare
#2 Posted by Harris Meyer, CJR on Mon 10 Sep 2012 at 01:17 PM
Harris makes a good point.
#3 Posted by Trudy Lieberman, CJR on Tue 11 Sep 2012 at 07:22 AM