For Immediate Release
Alan Barber 202-293-5380 x115
Cost of Medicare Equivalent Insurance Skyrockets under Ryan Plan
The plan will lead to seven dollars of waste for every dollar saved by the government.
WASHINGTON - The budget plan put forth by Representative Paul Ryan has been described by some as a serious, smart plan that will help reinvigorate the economy and reduce the deficit. Ryan’s plan, to revamp Medicare has been described as shifting costs from the government to beneficiaries. A new report from the Center for Economic and Policy Research (CEPR), however, shows that the Ryan proposal will increase health care costs for seniors by more than seven dollars for every dollar it saves the government, a point missing from much of the debate over the plan.
“The Ryan plan does nothing to control private-sector waste in health care costs,” said David Rosnick, an author of the report. “As a result of the waste in the private system, beneficiaries will end up paying substantially more for Medicare, in effect paying a hefty new tax on their health care.”
The report, “Representative Ryan’s $30 Trillion Medicare Waste Tax,” documents the potential effects of replacing Medicare with a system of vouchers or premium supports and raising the age of eligibility from 65 to 67 as suggested in the Ryan plan, which was passed by the House of Representatives with almost unanimous support from Republicans and no votes from Democrats. The authors note that each voucher under the plan will initially be worth $6,600 for a 65-year-old beneficiary but would be frozen at this amount over the program’s 75-year planning window, paying less and less of a beneficiary’s health care costs over time.
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The Center for Economic and Policy Research (CEPR) was established in 1999 to promote democratic debate on the most important economic and social issues that affect people's lives. In order for citizens to effectively exercise their voices in a democracy, they should be informed about the problems and choices that they face. CEPR is committed to presenting issues in an accurate and understandable manner, so that the public is better prepared to choose among the various policy options.