This morning, U.S. Senator Ron Wyden (D-OR) and U.S. Representative Paul Ryan (R-WI) introduced a new proposal that represents a major advance in the effort to build a more secure future for the millions of seniors who rely on Medicare.
The new report from Sen. Wyden and Rep. Ryan, titled "Guaranteed Choices to Strengthen Medicare and Health Security for All: Bipartisan Options for the Future," outlines a bipartisan path forward on expanding health care choices for seniors while preserving a traditional Medicare plan as an option. The report also proposes to give Americans under 65 more power and freedom to purchase coverage they can carry with them into retirement.
Sen. Ron Wyden had this to say about the proposal:
"Paul Ryan shares my belief that we don't hold election certificates to sit on the sidelines and that the only way to tackle some of the big challenges facing our nation is to work together on big solutions. Paul has also long-shared my view that the best way to hold down health costs is to give all Americans the ability to hire and fire their insurance company. Guaranteeing a future for traditional Medicare is a big challenge and it is our hope that outlining areas where Democrats and Republicans can reach agreement will help Congress rise to that challenge."
Rep. Paul Ryan stated:
"Ron Wyden has been a consistently strong leader on market-based health insurance reform and a true fighter when it comes to protecting seniors, so it was only natural that we should work together on a plan that saves Medicare from fiscal threats, strengthens the program through expanded choice, and guarantees that all seniors will have the means and the freedom to purchase coverage that is tailored to their needs. I am also proud to support Sen. Wyden's efforts to empower small businesses and their employees, so that Americans under 65 can find better health care options that they can carry with them into retirement.
"Today's report represents a major advance toward building the kind of bipartisan consensus that is going to be absolutely critical as we seek to meet our nation's greatest fiscal and economic challenges. By empowering seniors to use choice and competition to control costs and improve quality, our plan ensures that Medicare remains a guaranteed, affordable option for all seniors for decades to come."
For more information:
Read Senator Wyden and Representative Ryan's op-ed in The Wall Street Journal here.
Read the full report here.
Fact Sheet on the Wyden-Ryan Plan:
No changes for those in or near retirement. Americans currently over the age of 55 would see no changes to the structure of their benefits, although they would be free to opt into a private plan once the new Medicare Exchange was established in 2022.
More choices for seniors, including a traditional Medicare plan: Starting in 2022, Medicare would begin offering seniors a choice among Medicare-approved private plans competing alongside a traditional Medicare plan on a Medicare Exchange.
Premium support ensures affordable coverage: The plan would introduce a "premium support" system that would empower seniors to choose either a traditional Medicare plan or a Medicare-approved private plan.
More help for those who need it: Low-income seniors who qualify for Medicaid would continue to have Medicaid pay for their out-of-pocket expenses, while other low-income seniors who do not qualify for Medicaid would receive fully funded savings accounts to help offset any increased out-of-pocket costs.
Less help for those who don't: Wealthier seniors who need help least would see their assistance reduced.
Strong consumer protections to safeguard the Medicare guarantee: This reformed Medicare program would include some of the toughest consumer protections in American government:
All health plans that participate in the Medicare Exchange would be required to offer benefits that are at least the actuarial equivalent of those provided by the traditional Medicare plan.
Premium-support payments would be risk-adjusted to ensure that those with greater health needs are guaranteed affordable coverage.
Participating plans cannot refuse coverage based on pre-existing conditions, nor can they charge discriminatory rates based on health status.
All plans would be overseen by the Centers for Medicare and Medicaid Services (CMS), which would be empowered to review plan benefits and review all marketing materials to ensure transparency and fairness.
Transparency, Competition Work as Powerful Cost Controls: Program growth would be determined by the competitive bidding process -- with transparency, choice and competition forcing providers to reduce costs and improve quality for seniors.
Transparency: Seniors would receive clear and easy-to-understand information on what plan they are currently enrolled in, the projected cost of that plan, what other plans in their area will be offered, and what the federal premium-support contribution will be.
Choice: Allowing seniors to choose the plan that works best for them would force providers to compete for the patient's business, thus curbing the unsustainable rise of health care costs that is threatening both Medicare and the affordability of health care for all.
Competition: Allowing private plans to compete directly with a traditional Medicare plan would strengthen both by creating new incentives for plans to develop better delivery models and design better ways to care for patients with chronic illnesses.
Cap on Growth Serves as a Backstop: However, exceeding the cap would not trigger across-the-board bureaucratic cuts or higher premiums. Instead, Congress would be forced to do its job: Determine why the costs exceeded the cap and fix the problem.
A Proposal to Strengthen the Health Care Marketplace: Just as Medicare reform would give seniors more power to choose, reform is needed to free small businesses and individuals from restrictions that inhibit choice and control in health coverage.
Any small business with up to 100 workers would be able to offer its employees a free choice option so that they could use the amount that their employer contributes toward their health coverage to purchase their own health insurance.
The cost of the free choice option would be fully tax deductible to the employer, just like employer-provided health coverage.
Allowing individuals to keep one insurance product as they transition from their working years into retirement would ease seniors' transition into Medicare while giving small businesses and their workers more choices and freedom.