In Ironic Twist, Romney-Ryan Plan For Medicare Resembles ‘Obamacare’

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Determined to preempt Democratic attacks on their Medicare plan, Mitt Romney and Paul Ryan have launched an offensive to portray themselves as the protectors of the seniors program while attacking President Obama for having “robbed” Medicare to pay for ‘Obamacare.’

The charge is problematic because Ryan’s budget included the same $716 billion in provider pay cuts, although Romney and Ryan now say they’ll rescind the savings. But it’s ironic for another reason: the Romney-Ryan plan would convert Medicare into a program that’s remarkably similar to the Affordable Care Act.The Medicare plan in Ryan’s latest budget, which Romney says is “close to identical” to his own, has the details. In 10 years, Medicare would be remade into a subsidies system where seniors can buy insurance from a menu of private plans and a government option, with vouchers aimed at covering the cost of the cheapest two policies on the exchange.

That’s broadly similar to the core structure of Obamacare, under which the government sets up a regulated market exchange to ensure that plans cover a broad array of benefits. The law provides a subsidy to Americans who cannot afford insurance on their own.

Both plans also have mechanisms to compel people to participate: under Romney-Ryan, seniors are forced to pay Medicare taxes either way so they have no incentive not to use the voucher; under Obamacare, Americans either buy insurance or pay a tax penalty.

The similarities, significant as they are, hardly resemble bipartisan agreement because such a formula is not the ideal among either side — conservative prefer to continue deregulating the system; liberals argue that the health care market fails when left to its own devices. It’s more of a temporary overlap than an agreement, with Obamacare a sort of middle ground between the liberal ideal of a single-payer program and the conservative ideal of a deregulated, market-based system. Both sides want to keep moving in their preferred directions. But it does shed light on the real dynamics of the health care debate, and how the two sides have, at separate times, backed similar ideas for different reasons.

Another key difference: The Romney-Ryan approach would attempt to apply some of the key market-driven elements of Obamacare to the much older, sicker, and more-expensive-to-care-for seniors population. That raises the questions of whether the economic fundamentals can work with such a dramatically less insurable pool of participants. In contrast Obamacare targets a population that includes healthy people to absorb the insurance risk.

Unlike Obamacare, the Romney-Ryan plan for seniors includes a public option and provides subsidies for all participants. The fiscal 2012 version of Ryan’s Medicare plan, by contrast, excluded a public option and grew vouchers at the rate of inflation — lower than the rate at which health care costs tend to grow.

ABOUT THE AUTHOR

Sahil Kapur is TPM's senior congressional reporter and Supreme Court correspondent. His articles have been published in the Huffington Post, The Guardian and The New Republic. Email him at sahil@talkingpointsmemo.com and follow him on Twitter at @sahilkapur.
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