PoliGraph: Cravaack’s Medicare claim omits key details

  1. Listen Featured Audio

U.S. Rep. Paul Ryan’s budget proposal includes a big change to Medicare. Most notably, the Republican chairman of the House Budget Committee aims to convert the program into a system that offers what he calls “premium support,” which his detractors call vouchers. Among those defending Ryan’s proposal is Rep. Chip Cravaack of Minnesota.

“The [new Medicare] benefits being proposed is what I receive in Congress right now,” Cravaack assured listeners of April 14, 2011, Midmorning broadcast.

On the surface, there are similarities between the two plans. Look deeper, and the differences are stark.

The Evidence

Currently, the government pays doctors and hospitals for treating Medicare patients, though some beneficiaries also pay premiums and other costs.

The Ryan plan would change all that for those who are younger than 55. Starting in 2022, the government would provide beneficiaries with a payment, which they would use to buy insurance that meets standards set out by the Office of Personnel Management (OPM), a branch of government that also sets standards for federal employee coverage. Just as federal employees do, Medicare beneficiaries would be able to choose a private plan from an array of choices.

That’s where similarities between the plans end.

The federal employee plan isn’t much different from private sector employee-sponsored coverage: the federal government – or the “employer” – pays roughly 75 percent of premium costs, and federal employees pick up the remainder.

That ratio is commonly called the “Fair Share” formula because even if health care costs rise, the federal government is required by law to pick up the bulk of the tab.

Ryan proposes to link Medicare payments to the consumer price index, which has lagged behind increases in the cost of medical care. Over time, the payments Ryan is proposing would buy less coverage as a result, potentially making it difficult to purchase plans similar to those enjoyed by federal employees.

In fact, the Congressional Budget Office predicts that, under the Ryan plan, by 2030, the average 65-year-old beneficiary would be paying 68 percent of his or her benefits compared to 25 percent under current law.

It’s also worth pointing out that no detail has been given on how OPM would structure these plans and what sort of benefits insurance providers would be required to include. So, it’s impossible to say whether Medicare coverage would be like coverage Cravaack gets.

The Verdict

There’s a nugget of truth in Cravaack’s claim: the Republican plan envisions that Medicare and federal employee benefits would have to meet standards set by the same branch of government, and that both groups would get to choose from an array of private plans.

But Cravaack’s statement that the GOP Medicare proposal is “what I receive in Congress right now” is misleading to the point of being false because the government is guaranteed to cover 75 percent of his premium costs, regardless of how expensive health care gets. That’s not the case for the new Medicare plan proposed by the GOP; in fact, it is likely beneficiaries will end up paying far more than they do now.

SOURCES

Minnesota Public Radio News, Midmorning, April 14, 2011

The Path to Prosperity: Restoring America’s Promise, accessed May 3, 2011

The Congressional Budget Office, Letter to Paul Ryan regarding proposed changes to Medicare and Medicaid, April 5, 2011

The New York Times, Comparing Ryan’s Medicare Plan to What Congress Gets, by Uwe E. Reinhardt, April 18, 2011

The Congressional Research Services, Health Benefits for Members of Congress, by Barbara English, Sept. 25, 2007

The U.S. Office of Personnel Management, Federal Employees Health Benefits Program Handbook, accessed May 3, 2011

The Commonwealth Fund, Stark Choices: The Health Care Budget Proposals from the President and the House of Representatives, April 29, 2011, by Karen Davis

PolitiFact.com, Mike Pence said the Republican Medicare proposal will allow seniors to buy the same kind of health care as Congress, by Angie Drobnic Holan, April 13, 2011

The Washington Post, Fact Checker: GOP Medicare plan ‘just like’ Congress’s coverage?, by Glenn Kessler, April 30, 2011

Interview, Shawn Ryan, spokesman, Rep. Chip Cravaack, May 2, 2011

Interview, Jack Hoadley, Georgetown University Health Policy Institute, May 3, 2011

Interview, Stuart Guterman, Vice President for Payment and System Reform, the Commonwealth Fund, May 3, 2011

More

The Humphrey School

  • Linda

    I am so sick and tired of these right wingers thinking that the rest of the population is too stupid to know when we’re being lied to. Hey you wingnuts, see if you can answer this one truthfully. An unmarried woman finds herself pregnant and thinks that she would be unable to support this child on her own. But you have decided that she cannot have an abortion because you all cosider that murder. If a human life within a woman’s womb is so precious to you…how is it that you are diametrically opposed to providing top notch medical care for this child when it is diagnosed with Leukemia? How is it that you treat this child’s mother as a mooch when she applies for food stamps to feed herself and her child after all of her unemployment benefits run out and she still hasn’t been able to get another job? How is it that you want to de-fund Early Childhood Education for this child so that he can learn all of the life skills to provide him and those he cares about with all that is necessary to live the ‘good life’? It seems to me that you don’t consider this man’s life to be as ‘precious’ as it was while he was in his mother’s womb.

  • angeles

    I am 54 and I am worry about it. People vote for Republicans and this is the results of the wich of the people. We have to pay for what banks and finantial institutions, and Bush’s administration did. The only solution for the Republicans is make more people poor with less benefits to save money and give inversionists tax savings to made them more rich. I did worked hard since I was 17 and now the only option is going to Church to ask for provide brains for Republicans , because we the people knows what their doing and in the next elections we will let them now.

  • Sheila

    Bravo, Linda. Well said and to the point.