Out-of-pocket costs for Medicare beneficiaries would more than double under Republican plans to convert the federal health-insurance program for the elderly into a voucher system, according to estimates in a new congressional report.
Pennsylvania Democratic Sen. Bob Casey, chairman of the Joint Economic Committee, released the state-by-state analysis on Friday during a roundtable discussion in Scranton. The report is based on projections by the non-partisan Congressional Budget Office and state-specific utilization data from the federal agency that runs Medicare and its companion program for the poor, Medicaid.
“I am going to fight tooth and nail to make sure we don’t balance the budget on the backs of our older citizens,” said Casey, chairman of the bi-partisan JEC, which has members from both houses of Congress. “This isn’t a cost savings, it’s a cost shift.”
The House-passed GOP budget, written by Rep. Paul Ryan of Wisconsin, would provide those 65 and older with vouchers to purchase private health-insurance plans beginning in 2022, in order to slow the rapid rise in health-care costs exploding the federal budget.
But the costs will instead be borne by senior citizen beneficiaries of Medicare, as private-sector premiums will quickly outstrip the government voucher payments, Casey argued. Private insurers have proven to be less effective than Medicare itself at slowing price increases in health-care, he said.
CBO estimated that out-of-pocket costs for a Medicare beneficiary would jump from $6,154 to $12,513 annually when the Republican plan took full effect ten years from now – an increase of an average of $6,359 nationally.
Florida residents would see the biggest increase, $7, 383.16, the Casey report found.
New Jersey costs would rise an average of $7,060.03. And in Pennsylvania, out of pocket costs would jump an average of $6,303.27.
Democrats have seized on the proposed Medicare changes in the Ryan plan as a political weapon, likely to play a prominent role in their bludgeoning of GOP opponents in the 2012 elections. But the Democrats have not advanced a specific plan of their own to deal with the looming insolvency of Medicare.
The Social Security trustees say that Medicare will run out of funds in 2024 because of the rapid aging of the U.S. population and increasing costs, unless changes are made.