Reason Writers Around Town: Shikha Dalmia on the Least Screwy Health Care Option for Seniors

After complaining bitterly that Republicans were scaring seniors by talking about death panels under ObamaCare, Democrats have unleashed their own scare campaign against RyanCare. One ad by a liberal outfit actually shows a Paul Ryan-look alike pushing an old lady on a wheel chair off a cliff. But when you get past the scare mongering on both sides, which plan would be better for seniors?

Reason Foundation Senior Analyst takes a look in her latest column at The Daily and concludes:

ObamaCare is the worst thing that could happen to seniors in their old age; inaction is the next and RyanCare is the least bad. As a senior in the making, if those were my only options, I would ignore Democratic demagoguery and take RyanCare in a heartbeat. ObamaCare, however, I'd avoid like the plague.

Read the whole thing here.

Comments

[WTF]

One ad by a liberal outfit actually shows a Paul Ryan-look alike pushing an old lady on a wheel chair off a cliff.

Shikha's family quietly cheered.

[Rich]

ObamaCare will take $500 billion out of Medicare over 10 years to cover 30 million uninsured Americans. Basic arithmetic suggests that this would hasten the demise of the program.

Not if you factor in the cutting of waste and abuse.

[WTF]

If there is that much waste and abuse why isn't it being addressed now?

[Rich]

Note to self: Use less-subtle snark.

[WTF]

Oops - need to recalibrate sarcasm detector.

[OO]

alt ad - ryan hands grandma her voucher before pushing her wheelchair down the basement stairs.

[media]

weiner's weiner best be in the picture

[better ad]

ryan hands grandma her voucher then pushes her wheelchair down the freeway on-ramp so she can shop around for that good-ol affordable insurance!...plus weiner's weiner

[rather]

Why it won't work
http://rctlfy.wordpress.com/20.....-her-stds/

[MNG]

Look, didn't Soylent Green answer this question decades ago?

[Lord Humungus]

Soylent Red is scrummier.

[free2booze]

RyanCare is not perfect, but at least it won't rob Grandma Millie to buy Cousin Joe coverage.

I didn't know Biden was my cousin, but if he messes with my grandma, I'm gonna kick his ass!

But come 2022, everyone presently younger (than 55) would get an average of $15,000 ? the amount Medicare would spend per beneficiary ? in "premium support" to use toward a health plan of his or her choice.

The HORROR! How could we be so selfish? The elderly will be dying in the streets. What about duh poooooor?

Low-income and sick seniors could get up to another $8,000 or so.

[rather]

How much money does each medicare recipient need to earn for medicare to break even?

When you get that answer, you'll know why those subsidies are hilarious

[free2booze]

Break even? Medicare is an entitlement program, breaking even is irrelevant. You may FICA to support current retirees. When you retire, the people paying into FICA support you.

[free2booze]

An individuals yearly contribution to Medicare Part A is 1.45% on their income.

A person earning $50K per year, contributes $725. If this same person works for 50 years, the lifetime contribution is $36,250. To "break even", this person would have to receive a Medicare voucher for 2.4 years.

You're right, that is hilarious!

[rather]

250K

[free2booze]

Bullshit. $250K may represent the combined total of FICA - your share, 6.2%, plus your employers share, another 6.2%. A majority of FICA is marked for Social Security, not Medicare. According to the law, of the 6.2%, only 1.45% is marked for Medicare.

If you want to factor in the amount your employer contributes, even though this is not your contribution, 2.9% of $50K equals $1450 per year. Over 50 years, that total is $72,500, or 4.8 years of Medicare vouchers.

Yeah, seniors will be getting screwed big time.

[R C Dean]

My prediction: It won't be seniors who get screwed, it will be the taxpayers.

All that money you pay into Medicare is gone, long gone, when you retire. It is utterly irrelevant to balancing Medicare's books. The only number that is relevant is the amount paid by taxpayers that year.

So, if Medicare remains enormously expensive, it won't be the recipients who are screwed. It will be the taxpayers.

[rather]

I can't find my source but it takes a participant's 250K salary, per year, over their lifetime, for Medicare to break even.

[free2booze]

What does that even mean? Are you suggesting that a person has to earn $250K per year, for their FICA contribution to equal the benefit they receive from Medicare? If so, that is impossible, because FICA doesn't apply to income over $106K.

[rather]

yes, even though FICA taps out, theoretically, that's what it takes. Think of it instead as how many individuals it takes to support one person on Medicare

[free2booze]

I think I see your point more clearly now.

So, are you saying that, because of the size of the voucher, that seniors would not receive enough money to cover their health care costs?

If so, you have to remember that they will be purchasing private insurance with the voucher. As it stands now, plenty of people cost more than they pay, but we have enough people who pay more than they use, that it balances out. Ryan's Medicare proposal would be no different.

I realize that we will no longer be giving seniors a defined benefit, and instead a defined contribution. I see no problem with that. Defined contribution plans are unsustainable. Besides, an entire working career should be enough time to put away a nest egg to cover out of pocket costs.

If you really want to see affordable prices for senior, under the Ryan plan, decouple insurance from the employer. If a person could keep the same insurance provider for 10, 20, 30 years, then providers could base insurance premiums on tenure. All of those years that you didn't use the amount of healthcare, as you paid in, would offset the years you use more care than you paid for, reducing the cost of insurance in your golden years.

[rather]

So, are you saying that, because of the size of the voucher, that seniors would not receive enough money to cover their health care costs?

Yes, flawlessly said

If so, you have to remember that they will be purchasing private insurance with the voucher. As it stands now, plenty of people cost more than they pay, but we have enough people who pay more than they use, that it balances out. Ryan's Medicare proposal would be no different.

Regrettably, your premise will not be accurate with a flood of elderly into the private market. You are referring to a market that counterbalance itself precisely because there are no elderly in it!

I realize that we will no longer be giving seniors a defined benefit, and instead a defined contribution. I see no problem with that. Defined contribution plans are unsustainable. Besides, an entire working career should be enough time to put away a nest egg to cover out of pocket costs.

Whether the present plan is not sustainable does not negate the fact that Ryan's plan will fail. I don't know what you qualify as a 'nest egg', but one medical emergency can easily wipe-out 100k.

If you really want to see affordable prices for senior, under the Ryan plan, decouple insurance from the employer. If a person could keep the same insurance provider for 10, 20, 30 years, then providers could base insurance premiums on tenure. All of those years that you didn't use the amount of healthcare, as you paid in, would offset the years you use more care than you paid for, reducing the cost of insurance in your golden years.

In theory, I love this. In practice, insurance companies will fight it. They love to renegotiate contracts for a reason.