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Why Ryan Might Be Right | RealClearPolitics
Overlooked in the furor surrounding Paul Ryan's Medicare proposal -- a plan, it should be recalled, that wouldn't start until 2023 and even then would affect only new beneficiaries -- is a just-published study in The Journal of the American Medical Association (JAMA) suggesting that, well, Ryan might be right. The study finds that a voucher-type system might noticeably reduce costs compared to "traditional" fee-for-service Medicare. Three Harvard economists did the study, including one prominent supporter of President Obama's health care overhaul.
The study compared the costs of traditional Medicare with Medicare Advantage, a voucher-like program that now enrolls about 25 percent of beneficiaries. Medicare Advantage has cost less for identical coverage. From 2006 to 2009, the gap averaged 11 percent between traditional Medicare and voucher plans that, under the proposal by Ryan and Sen. Ron Wyden, D-Ore., would serve as a price "benchmark."
The central issue here is whether the runaway costs of the health sector, comprising nearly one-fifth of the economy, can be controlled without eroding medical quality. Almost everyone agrees that the delivery system -- the amalgam of hospitals, clinics, doctors and nurses -- should be reorganized to lower costs and eliminate unneeded care. The question is how.
Overlooked in the furor surrounding Paul Ryan's Medicare proposal -- a plan, it should be recalled, that wouldn't start until 2023 and even then would affect only new beneficiaries -- is a just-published study in The Journal of the American Medical Association (JAMA) suggesting that, well, Ryan might be right. The study finds that a voucher-type system might noticeably reduce costs compared to "traditional" fee-for-service Medicare. Three Harvard economists did the study, including one prominent supporter of President Obama's health care overhaul.
The study compared the costs of traditional Medicare with Medicare Advantage, a voucher-like program that now enrolls about 25 percent of beneficiaries. Medicare Advantage has cost less for identical coverage. From 2006 to 2009, the gap averaged 11 percent between traditional Medicare and voucher plans that, under the proposal by Ryan and Sen. Ron Wyden, D-Ore., would serve as a price "benchmark."
The central issue here is whether the runaway costs of the health sector, comprising nearly one-fifth of the economy, can be controlled without eroding medical quality. Almost everyone agrees that the delivery system -- the amalgam of hospitals, clinics, doctors and nurses -- should be reorganized to lower costs and eliminate unneeded care. The question is how.