On CBS’s Face the Nation, Democratic National Committee chair Rep. Debbie Wasserman-Schultz (FL) said this of the House Republicans’ Medicare reform plan:
Republicans have a plan to end Medicare as we know it. What they would do is they would take the people who are younger than 55 years old today and tell them ‘You know what? You’re on your own. Go and find private health insurance in the healthcare insurance market, we’re going to throw you to the wolves and allow insurance companies to deny you coverage and drop you for pre-existing conditions. We’re going to give you X amount of dollars and you figure it out.
That ‘s the version of Wasserman-Shultz’s quote that the Washington Post’s Glenn Kessler sent me. Kessler also told me that the DNC cited me as a source for Wasserman-Shultz’s claims:
Michael Cannon: The Ryan Plan Would Provide More Subsidies To Seniors With Pre-Existing Conditions But Wouldn’t Guarantee Coverage. Michael Cannon, the Director of Health Policy Studies at Cato said during congressional testimony on the Ryan plan, “Thank you for the opportunity, Congressman. I think that lots of – all seniors under the chairman’s proposal, as I understand it, will be able to obtain health insurance coverage. And that’s the – that is because the payment they receive from the federal government to purchase that coverage will be adjusted for income so that lower-income people will get larger vouchers if you will. He doesn’t call them that, I’ll use the V word. And they’ll also be risk-adjusted so that people with severe illnesses will get larger vouchers and be able to purchase insurance coverage that will cover a lot of people who have a pre-existing condition. [HEARING OF THE HEALTH CARE, DISTRICT OF COLUMBIA, CENSUS AND THE NATIONAL ARCHIVES SUBCOMMITTEE OF THE HOUSE OVERSIGHT AND GOVERNMENT REFORM COMMITTEE, 4/5/11]
The Actual Amount More Seniors With Pre-Existing Conditions Would Receive Had Not Been Set Out In The Ryan Budget. Michael Cannon, the Director of Health Policy Studies at Cato said during congressional testimony on the Ryan plan, “That would be a result of the rules, the specific risk-adjustment rule that haven’t been spelled out in his budget. But you would have sick people getting a lot more money.” [HEARING OF THE HEALTH CARE, DISTRICT OF COLUMBIA, CENSUS AND THE NATIONAL ARCHIVES SUBCOMMITTEE OF THE HOUSE OVERSIGHT AND GOVERNMENT REFORM COMMITTEE, 4/5/11]
Empasis in original.
Kessler judged Wasserman-Shultz’s claim to be “bogus.” FactCheck.org said it was “simply wrong.”
Kessler quoted me in his fact-check, but I think he left out the most important parts. So here’s my entire email response to Kessler:
This is some high-octane idiocy.
Ryan’s plan says that insurance companies could not turn away seniors. I’m not sure whether that means only (A) that insurers must issue a policy to all applicants (i.e., guaranteed issue) or whether Ryan’s plan would go further and (B) prevent insurers from charging sick enrollees more (i.e., price controls). I hope Ryan would not include such price controls, but I see hints that that’s where he’s leaning. If so, then the Ryan plan would include the very government guarantee that the DNC is complaining isn’t there. It’d be a lousy guarantee, but it’d be there.
Regardless, the DNC’s attacks are still bunk.
If insurers can charge sick Medicare enrollees whatever they want, and Medicare gives sick enrollees enough money to cover those higher premiums, who needs price controls? High premiums aren’t scary if you have the money to pay them. A fair question would be whether the vouchers would be large enough. The best evidence available (from the Dartmouth Atlas) suggests that one third of spending in traditional Medicare is pure waste. That is a huge margin of safety: it means that the vouchers could be one-third less than what a Medicare enrollee would otherwise spend without reducing access to necessary care. The quotes they took from me completely undercut their attacks on the Ryan plan. I hope they keep quoting me.
Experts widely acknowledge that traditional Medicare exposes seniors to unnecessary and even harmful services. And Medicare is rapidly consuming more and more of every American’s paycheck. I can’t imagine anything more irresponsible than defending Medicare as we know it.
