The Mitt Romney and Paul Ryan Medicare plan is two-pronged, says a study by the Center for American Progress. And dangerous to the wallets of seniors. And even more dangerous to the wallets of future seniors who expect their health needs will be provided in retirement.
Not to mention the danger of doing without health benefits.
The first prong of the plan is the proposal to introduce vouchers to seniors, in lieu of the traditional Medicare plan.
The second prong of the plan is to privatize Medicare and take it out of the hands of the government.
Coupled with Mitt Romney promise to “repeal” and “not replace” Obamacare, it means that every benefit of The Patient Protection and Affordable Care Act will be eliminated.
They claim that their plan does not affect seniors or anyone 55 years old or over. But that claim is false, according to the Center for American Progress.
The result of both of those actions will drive the cost to the retiree through the roof. By repealing the The Patient Protection and Affordable Care Act, the Mitt Romney and Paul Ryan Medicare plan, would raise health care costs in retirement by $11,000 for the average person who is 65 years old today. Nearly $1,000 a month for a person on a fixed income.
Also, a substantial share of Medicaid spending pays for health care costs for Medicare beneficiaries, says the Center for American Progress. The plan proposed by the Republicans means that Medicaid cuts mean a loss of over $2,500 annually for seniors currently on Medicare who also rely on Medicaid. Unlike the Medicare voucher system that would begin in 2023, the cuts to Medicaid under the Republican plan would begin almost immediately.
The plan also means increased drug costs (with the elimination of the doughnut hole) It also means higher Medicare premiums, which negates the claim that the plan would not affect current seniors or those 55 and over.
For seniors who will become eligible for Medicare after 2022, the financial harm would be even worse. That’s when the voucher system kicks in. It is also when the privatization portion of Medicare kicks in too.
Under the Mitt Romney and Paul Ryan Medicare plan, seniors turning 65 in 2023, Medicare costs during retirement years would increase by $59,500 in 2012 dollars under the Romney-Ryan plan. Because under their plan the amount of seniors’ vouchers will not keep pace with rising health care costs. These numbers, the Center for American Progress points out, are even worse for future generations.
In today’s dollars, seniors who qualify for Medicare in 2030 would see an increase of $124,600 in Medicare costs over their retirement. Seniors who qualify for Medicare in 2040 will see an increase of $216,600. And by 2050 newly eligible seniors will pay $331,200 more in Medicare costs over their retirement. That’s the voucher portion of their plan.
The privatizing portion of the plan is more problematic. There is a danger of insurance companies cherry picking, choosing to insure only the healthiest of policyholders. Because more emphasis will be made on private companies insuring seniors, Medicare would no longer enjoy a balanced risk pool and seniors choosing traditional Medicare could wind up paying an extra $29,000 on average, according to the American Center for Progress.
The “repeal” of Obamacare is also problematic for seniors for several reasons, says the study.
First, the cost sharing for parts A (hospital care) and B (physician services) will increase because the Affordable Care Act’s adjustments to payment rates for health care providers other than physicians will be repealed. Second, the change will lead to increases in premiums. Third, the reinstatement of the “doughnut hole” will cause prescription drugs to once again skyrocket. Fourth, the cost sharing for preventive services will be eliminated and cost seniors more for these services such as cancer screenings which are now free.
The study concludes that all Americans would be forced to spend more on health care during their retirements. Much more for future seniors through 2030 and 2040. The cost of not being able to afford the plan will mean forgoing retirement or doing without.
There is no question that the long-term costs of medical care need to be addressed. The American Center for Progress says that forcing “seniors to shoulder the entire burden of rising health care costs is not the solution.”
The Patient Protection and Affordable Care Act takes steps in the right direction. Although more needs to be done, the Mitt Romney and Paul Ryan Medicare plan takes us into a more costly directions for seniors.
Moneywise and healthwise.
Source: Center for American Progress study
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John is the author of an award-winning book, the 2010 Winner of the USA National Best Book award for African-American studies, published by The Elevator Group Mr. and Mrs. Grassroots: How Barack Obama, Two Bookstore Owners, and 300 Volunteers did it. Also available an eBook on Amazon. John is also a member of the Society of Midland Authors and is a book reviewer of political books for the New York Journal of Books