"A Bipartisan Healthcare Plan - Perhaps?"
Sydney M. Williams
The first clue that the Wyden-Ryan bi-partisan healthcare proposal unveiled last Wednesday may be more than just another political feint is that the New York Times reported the news on page 29 of the first section. The Wall Street Journal, in contrast, placed its article on A2, but that may have been because the authors of the proposal, Senator Ron Wyden (D-Oregon) and Representative Paul Ryan (R-Wisconsin), had an op-ed in the paper that morning. It would have been impolitic to have placed the article somewhere deep within its pages.
For two reasons this proposal is important. First, and most critical, Medicare is on a trajectory to either bankrupt the nation, or to deprive its recipients of real healthcare. One way or another, it must be dealt with. Second, Congress, with approval ratings hovering just above single digits, needs to show the American people they can actually do something in a bi-partisan fashion.
The plan, as announced, would make structural changes in Medicare and limit the government’s open-ended commitment to the program. (There are skeptics who suggest that the Affordable Care Act will be funded on the backs of seniors.) The system, as proposed, would limit spending increases to growth in GDP, plus one percentage point – a slower rate of increase than Medicare has historically enjoyed. But, importantly to those of who recognize the value of competition, Wyden-Ryan would allow private insurance companies to compete alongside Medicare, providing consumers a choice. It is possible, of course, that Medicare’s financial clout – and government backing – could keep competitors at bay; so that competition would remain more a mirage than a reality, but then look at the U.S. Post Office and compare it to Federal Express or UPS. Any private plan would have to cover specific ailments and procedures while offering benefits equal to or greater than Medicare. Congress would have the authority to cut payments to providers or suppliers for overspending.
Additionally, the proposal incorporates a “means” component. Government could increase Medicare premiums to high-income beneficiaries, while lower-income beneficiaries would have all or some of their premiums paid.
As expected, Liberals expressed concern that the highly popular fee-for-service Medicare will be weakened. They argue that government is the only force capable of cost control and worry that diverting beneficiaries into private plans will weaken Medicare’s bargaining power. Conservatives remain concerned that an agreement with Senator Wyden is tantamount to placing a liberal-based Trojan horse within the Republican caucus – and that the President remains adamant in his desire for a single payer.
Medicare is the elephant in the room when it comes to government programs, loved by its recipients, but unaffordable in its current conformation. The system has been termed the “third rail” of politics, for the simple reason that politicians have no problem giving away other people’s money, but they shun from taking anything back. Presidents and Legislators have deliberately avoided the issue, assuming the position of the three monkeys – they see no evil, hear no evil, so speak no evil. Of course, any rational person who has taken fourth grade math knows that Medicare, in its current form, cannot survive. Nevertheless, every member of Congress assumed it would last through their term. ‘Kick the can down the road’ has been their mantra. However, it is now too late for any member of Congress to assume that ostrich-like position.
In my opinion the most important aspect of the Wyden-Ryan plan is that it introduces the concept of competition. Healthcare is different from other purchases, in that, in cases of emergency, the care must be rendered without scoping out the competition. There is not the time. But, in other cases, in terms of drug purchases, elective surgery, insurance coverage, who do you want as your primary physician the market should be open to competition. Our healthcare analyst, Avik Roy, writing in Forbes, said it well: “This principle – the principle of making the sellers of health care compete with each other – is at the heart of competitive bidding, which in turn is the core of the Wyden-Ryan proposal.” Unfortunately, though, Wyden-Ryan does nothing to address the urgent need for tort reform, so costs associated with rising and unnecessary legal settlements will continue to plague the industry and consumers.
The reviews of Wyden-Ryan have been mixed. The Washington Post congratulated the two legislators for “for having the tenacity to try again.” The “Lund Report” attacks Senator Wyden for caving into the Tea Party: “In Oregon, we like our Medicare just the way it is.” The Des Moines Register is worried that the focus on budget cutting threatens compromising America’s historical leadership in medical research. Avik Roy, again writing in Forbes, notes that no plan getting through Congress will ever be perfect, “but it’s likely to be our best chance of getting both parties to come together…If it succeeds, Wyden-Ryan may turn out to be one of the most significant legislative initiatives of the decade.”
From my nonprofessional perspective, Wyden-Ryan looks like a good start. It is certainly better than staying with a system that will lead to bankruptcy, and we will see what finally evolves. Nevertheless, I would have preferred something closer to the original Ryan plan, and I can assure you that no one was going to throw this grandfather off a cliff. In politics, you must take what you can. Political concessions are usually imperfect, but compromised solutions have treated this country very well over the past two hundred years. Democracies have never been known for being efficient; efficiency is used as a justification for the world’s dictatorships and totalitarian regimes, whether it’s the Fascists of seventy years ago in Italy with their trains, or the Chinese today with their manufacturing. In the end, though, they always fail.
Thought of the Day
“A Bipartisan Healthcare Plan – Perhaps?”
December 20, 2011“We can elect a man to Congress, but we cannot make him (or her) legislate. ”
The first clue that the Wyden-Ryan bi-partisan healthcare proposal unveiled last Wednesday may be more than just another political feint is that the New York Times reported the news on page 29 of the first section. The Wall Street Journal, in contrast, placed its article on A2, but that may have been because the authors of the proposal, Senator Ron Wyden (D-Oregon) and Representative Paul Ryan (R-Wisconsin), had an op-ed in the paper that morning. It would have been impolitic to have placed the article somewhere deep within its pages.
For two reasons this proposal is important. First, and most critical, Medicare is on a trajectory to either bankrupt the nation, or to deprive its recipients of real healthcare. One way or another, it must be dealt with. Second, Congress, with approval ratings hovering just above single digits, needs to show the American people they can actually do something in a bi-partisan fashion.
The plan, as announced, would make structural changes in Medicare and limit the government’s open-ended commitment to the program. (There are skeptics who suggest that the Affordable Care Act will be funded on the backs of seniors.) The system, as proposed, would limit spending increases to growth in GDP, plus one percentage point – a slower rate of increase than Medicare has historically enjoyed. But, importantly to those of who recognize the value of competition, Wyden-Ryan would allow private insurance companies to compete alongside Medicare, providing consumers a choice. It is possible, of course, that Medicare’s financial clout – and government backing – could keep competitors at bay; so that competition would remain more a mirage than a reality, but then look at the U.S. Post Office and compare it to Federal Express or UPS. Any private plan would have to cover specific ailments and procedures while offering benefits equal to or greater than Medicare. Congress would have the authority to cut payments to providers or suppliers for overspending.
Additionally, the proposal incorporates a “means” component. Government could increase Medicare premiums to high-income beneficiaries, while lower-income beneficiaries would have all or some of their premiums paid.
As expected, Liberals expressed concern that the highly popular fee-for-service Medicare will be weakened. They argue that government is the only force capable of cost control and worry that diverting beneficiaries into private plans will weaken Medicare’s bargaining power. Conservatives remain concerned that an agreement with Senator Wyden is tantamount to placing a liberal-based Trojan horse within the Republican caucus – and that the President remains adamant in his desire for a single payer.
Medicare is the elephant in the room when it comes to government programs, loved by its recipients, but unaffordable in its current conformation. The system has been termed the “third rail” of politics, for the simple reason that politicians have no problem giving away other people’s money, but they shun from taking anything back. Presidents and Legislators have deliberately avoided the issue, assuming the position of the three monkeys – they see no evil, hear no evil, so speak no evil. Of course, any rational person who has taken fourth grade math knows that Medicare, in its current form, cannot survive. Nevertheless, every member of Congress assumed it would last through their term. ‘Kick the can down the road’ has been their mantra. However, it is now too late for any member of Congress to assume that ostrich-like position.
In my opinion the most important aspect of the Wyden-Ryan plan is that it introduces the concept of competition. Healthcare is different from other purchases, in that, in cases of emergency, the care must be rendered without scoping out the competition. There is not the time. But, in other cases, in terms of drug purchases, elective surgery, insurance coverage, who do you want as your primary physician the market should be open to competition. Our healthcare analyst, Avik Roy, writing in Forbes, said it well: “This principle – the principle of making the sellers of health care compete with each other – is at the heart of competitive bidding, which in turn is the core of the Wyden-Ryan proposal.” Unfortunately, though, Wyden-Ryan does nothing to address the urgent need for tort reform, so costs associated with rising and unnecessary legal settlements will continue to plague the industry and consumers.
The reviews of Wyden-Ryan have been mixed. The Washington Post congratulated the two legislators for “for having the tenacity to try again.” The “Lund Report” attacks Senator Wyden for caving into the Tea Party: “In Oregon, we like our Medicare just the way it is.” The Des Moines Register is worried that the focus on budget cutting threatens compromising America’s historical leadership in medical research. Avik Roy, again writing in Forbes, notes that no plan getting through Congress will ever be perfect, “but it’s likely to be our best chance of getting both parties to come together…If it succeeds, Wyden-Ryan may turn out to be one of the most significant legislative initiatives of the decade.”
From my nonprofessional perspective, Wyden-Ryan looks like a good start. It is certainly better than staying with a system that will lead to bankruptcy, and we will see what finally evolves. Nevertheless, I would have preferred something closer to the original Ryan plan, and I can assure you that no one was going to throw this grandfather off a cliff. In politics, you must take what you can. Political concessions are usually imperfect, but compromised solutions have treated this country very well over the past two hundred years. Democracies have never been known for being efficient; efficiency is used as a justification for the world’s dictatorships and totalitarian regimes, whether it’s the Fascists of seventy years ago in Italy with their trains, or the Chinese today with their manufacturing. In the end, though, they always fail.
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