No doubt you’ve probably heard the hype over Congressmen Ryan’s budget proposal. While it may look like a sincere effort to resolve the financial issues facing our government, it seems like no one has thought about the long-term consequences this bill will have on older Americans. The talk over the Medicare reform centers upon privatizing the program. It provides for vouchers paid, from the Medicare tax, to give beneficiaries an opportunity to shop around and find a private healthcare plan. In order to really grasp the severity of the problem, there are a couple of issues you need to understand. First the voucher increases are not tied to the rising cost of healthcare. Instead, its increases are based upon the consumer price index (CPI). It is well known that the CPI does not keep pace with healthcare cost. Second is that the voucher is paid directly to the insurance company, bypassing the Medicare Beneficiary.
Here’s the problem in a nutshell. Say you retire in 2015 and start receiving your benefit. At first you pick a plan that you think is satisfactory. OK so far, right? Over the next few years, the cost of your insurance policy, along with healthcare, increases faster than your voucher. Soon you find it no longer pays the full cost of the policy. To maintain your insurance it will be necessary to put in money out of your own pocket. Soon you’ll be unable to continue paying the cost and will be faced with one of three choices; dip into your retirement savings, find a cheaper plan that covers less or cancel your health insurance. This may not seem bad except remember; the voucher is paid directly to the insurance company so you cannot personally accept the voucher. If you could, you’d at least be able to use it to pay for office visits with your family doctor. So, if you cannot afford to pay the difference between the voucher and the cost of the plan, you’ll lose the voucher. This will effectively end your benefits under the Medicare Program. How’s that for a death panel? As you age you will reach a point where you will have no insurance and before you can qualify for Medicaid, you’ll need to expend the majority of your assets. Congressmen Ryan sidesteps this and this is his “dirty little secret”.
This problem will result in many older Americans, especially at the lower income levels, being left without any form of health insurance. Of course the money you contributed, throughout your life, will be there to help pay for the vouchers of those who recently retired. Last year, with the vote of nearly every House Republican, the bill passed the House. Lucky for us it failed to clear the Senate. The Republicans are poised to try again this session. Make no mistake; it is their intent to effectively end Medicare for older Americans. Of course the government will continue to collect the mandatory Medicare Tax from everyone. If this is what you think you want then you should vote Republican this fall; however, if you think that as you grow older you are going to need insurance remember this; the Republican Party has publicly supported this plan that has the ability drive many older Americans into bankruptcy. Think about this in November when you vote. Who needs death panels, we’ve got the Republican Party.
