Reason-Rupe: Americans Favor Paul Ryan's Medicare Reform Over President Obama's

The September Reason-Rupe national telephone poll of 1,006 Americans finds Americans may actually prefer Rep. Paul Ryan's Medicare reform plan over President Obama's when considering the costs and benefits of each plan.

When respondents are read the likely benefits and costs of both Paul Ryan's and President Obama's Medicare reforms, 61 percent of voters think out-of-pocket costs would increase for seniors as a result of Ryan's plan and 51 percent think Obama's plan would lead to shortages and less medical innovation. However, by a margin of 48 to 37 percent, voters prefer Medicare reforms built around giving seniors a credit to purchase health insurance over reforms like President Obama's, which include a payment board to reduce payments to providers.

These results stand in contrast to typical polls asking about Medicare reform because most polls provide respondents with false choices: would they like Medicare to stay the same or change in some particular fashion. (see August CBS/New York Times poll, page 11). Not surprisingly, since most Americans say they like Medicare they opt for the status quo over reform. However, without change Medicare is on the path to insolvency; thus, Medicare must change, the question is how.  Poll questions failing to provide realistic trade-offs perpetuate the pervasive misunderstanding characterizing the Medicare reform debate. 

President Obama and Rep. Paul Ryan have offered their differing visions of reform. Instead of comparing each proposal to the status quo, these reforms must be compared against each other. Both offer benefits, both offer costs, the ultimate question is which set of costs and benefits would Americans rather face.

The president's vision of Medicare reform reduces Medicare spending by appointing a board to reduce payments to doctors and other healthcare providers and to discourage coverage of treatments they believe are not cost-effective. Employing price controls to reduce Medicare spending has the advantage of ostensibly not raising out-of-pocket costs to seniors. However, regulation does not operate in a vacuum, and price controls could lead to reduced access to care, shortages, and lowered incentives for medical innovation.

Rep. Paul Ryan aims to reduce Medicare spending by introducing competition into Medicare by giving seniors a credit to purchase private health insurance to incentivize health insurers to find ways to reduce costs. Enabling competition in Medicare offers greater choice to seniors and ostensibly better rewards medical innovation. However, competition may not sufficiently drive down costs and seniors could be left having to pay higher out-of-pocket costs for their health care.

The Reason-Rupe poll asked respondents about each of these proposals (rotating the order) and then asked respondents to compare.

(Continue reading on next page to see question wording)

(One proposal/another proposal) would create a board to identify what it views as non cost-effective medical treatments and would reduce or eliminate payments to doctors and health insurance companies for these services. Supporters say this would lower Medicare's costs and ensure that seniors don't have to pay more money out of pocket. Opponents say it would result in shortages and fewer medical innovations. 

(One proposal/another proposal) would introduce competition among health insurance companies by giving seniors a credit to purchase the health insurance plan of their choice from private companies or the government. Supporters say this would lower Medicare's costs and ensure that seniors have more health care choices. Opponents say it would result in seniors paying more money out-of-pocket for their own health care.

In sum, Americans are not enthusiastic about Ryan's plan to reform Medicare; however, they are even less enthusiastic about Obama's plan. When voters compare the costs and benefits of the most realistic alternatives to reform Medicare, they opt for competition and choice, even if it costs them more, rather than bureaucracy and price controls.