Mitt Romney's Medicare plan
GOP presidential hopeful Mitt Romney
earlier today in Sioux City, Iowa:
This week was a big week, because a Republican congressman and a Democrat senator came together and said we've got an idea for making Medicare work. You know, I'm kind of proud, because it was the same idea I put forward about a month ago.
Romney is talking about Rep. Paul Ryan (R-WI) and Sen. Ron Wyden (D-OR), who yesterday announced a plan to turn Medicare into a voucher program. Democrats—including the White House—immediately rejected the proposal as nothing more than a warmed over version the Medicare-repeal plan passed by House Republicans last April, but Mitt Romney was so excited by their announcement that he decided to claim credit.
Romney must think that he's immune to criticism because one Democratic senator signed onto his plan, but with or without Wyden's support, his plan—even in his own words—would eliminate the Medicare program that currently exists.
Here's how Romney describes it:
The idea was this: With regards to Medicare in the future, I'll call it Medicare 2.0 for young people coming along, for Medicare in the future, you'll be able to get a premium support payment as a retiree, and you can use that to either buy traditional Medicare or to buy a private plan, and they'll compete, private plans with government Medicare. And by the way, people with higher income will get a smaller payment, they get a smaller subsidy.
So under Romney's plan, future retirees would no longer get Medicare—instead they'd get a subsidy, the size of which would depend on their income. They would then be able to spend that subsidy on various private plans or a government option. He calls the public option "traditional Medicare," but that's just a rhetorical device. Because Medicare would not longer be a single payer system, it would become less efficient and would be in a worse position to keep costs down. Meanwhile, the fact that beneficiaries would be getting a subsidy rather than insurance means that either (a) their share of medical costs would grow or (b) public health care spending would grow even faster than before. Either way, the idea is a stinker.
As the Center for Budget and Policy Priorities says:
Despite claims to the contrary, it likely would shift substantial costs to beneficiaries rather than protect them from such cost increases, could lead to the demise of traditional Medicare over time rather than preserve it, and likely would produce few savings.
The idea of privatizing Medicare is bad policy and is very unpopular with the public, but Republicans absolutely love it. So even though Mitt Romney's "Medicare 2.0" plan might help him win the Republican nomination, it's going to be a deal breaker for many Americans next November and could very well be the issue that costs Mitt Romney the chance to become president.