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Affordable Care Act extends health care safety net for seniors

My Side
Bob Semro
Glenwood Springs, Colorado CO

Rep. Scott Tipton, in an April 2 My Side commentary in the Post Independent, “How I’m fighting for seniors in Washington,” touted a “bold” budget plan approved by House Republicans as the blueprint for preserving “Medicare and other critical safety nets for seniors.”

Bold? Irresponsible is more like it.

The plan would remove the anchors for those safety nets. In order to reduce pressure on the federal budget, the plan would dramatically shift responsibility for those safety nets to the states. More and more seniors would face increasing pressure on costs.



Some clarification and explanation is in order.

Mr. Tipton’s commentary described the so-called Ryan budget, named for Wisconsin Rep. Paul Ryan, who chairs the House Budget Committee. Even though it is not likely to become law, the plan has passed the House two years in a row and represents an alternate path on spending. Mr. Tipton touched on two major topics: Medicare and the Independent Payment Advisory Board.



Under the Ryan plan, Medicare would cease to exist in its current form for people born after 1957. It would become a voucher-based “premium support” program.

Seniors would get a fixed amount of money to help pay for Medicare or private insurance, with no guarantee that the allotment would keep up with rising health care costs.

Most experts agree that out-of-pocket costs would increase year after year, and according to the nonpartisan Congressional Budget Office, the voucher would be worth 77 percent of current coverage within seven years. Seniors would make up the difference.

By contrast, under the Affordable Care Act, all traditional Medicare benefits are protected. In addition:

• The Medicare Part D prescription drug “doughnut hole” would be virtually closed by the year 2020 (saving affected seniors as much as $3,000 annually).

• Seniors would have access to a range of preventive services without out-of-pocket costs.

• Medicare primary-care providers and general surgeons would be given bonuses to practice in rural areas.

Currently, Medicare spending grows at an average rate of about 6.4 percent per year. Under the new health care law, Medicare spending will be allowed to grow by 5.4 percent. That reduction in spending growth will extend the solvency of the Medicare program by at least seven years, with no reduction in benefits.

The lower growth rate will require a reduction in spending, and one mechanism for achieving that is the Independent Payment Advisory Board.

Congressman Tipton’s commentary described the board as “unelected,” “unaccountable,” “federal bureaucrats” who would “make critical health care decisions for patients” and make “cuts to Medicare.”

Here’s a fuller description of the board: It will be 15 members who are doctors, medical professionals and consumer advocates, each confirmed by the Senate. They will make recommendations to reduce spending growth in Medicare, after reviewing new technologies and best practices from across the country.

And note: the board is prohibited from making recommendations that would ration care, raise taxes, increase premiums, restrict benefits or modify Medicare eligibility.

Congress also has the authority to override any board recommendation, provided that it meets the same spending-reduction targets.

Mr. Tipton argued for supporting a bill that would repeal the board. That repeal would do little more than keep the current system – which has failed to reduce spending – in place.

His commentary did not mention Medicaid, the state-federal program for low-income families and seniors. Medicaid represents the most important safety net for seniors for long-term care because it covers the cost of nursing home care when they can’t pay for it on their own.

The Ryan budget would cut Medicaid by $810 billion over the next 10 years and convert it to a block-grant program, with each state getting a fixed amount of money. States then would be required to pay for services, using the fixed amount plus their own funds. As the costs increase, states would either have to put in more of their own money, raise fees or reduce services.

The way to preserve Medicare and other safety nets for seniors is to implement the Affordable Care Act and build on its mechanisms to expand health care coverage, make it more affordable and, over time, control costs.

Bob Semro is a health care policy analyst with the Bell Policy Center, a nonpartisan policy research center that advocates public policies that reflect progressive values.


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