Paul Ryan’s Medicare plan is not Bill Clinton’s fault
Of late, Paul Ryan has adopted the curious tactic of blaming his Medicare plan on Bill Clinton. Back in April, he said a version of his plan was “endorsed by everyone from President Clinton’s 1999 Medicare commission, chaired by Democrat John Breaux, to Bob Dole and Tom Daschle in 2009.” This week, he said his plan is “in keeping with the Bill Clinton bipartisan commission.” It’s a good argument. The only problem? It’s not true.
And it’s not true on a couple of different levels. First, as FactCheck.org says, “any attempt to cast the 1999 report as bipartisan or suggest it was Clinton’s commission is misleading.” The commission was created in the Balanced Budget Act of 1997, which was written by and passed through a Republican Congress. Clinton appointed just four of the commission’s 17 members — all of whom voted against the final plan. So it wasn’t “the Bill Clinton bipartisan commission.”
Second, the commission failed: It needed 11 votes and only got 10, eight of them from Republicans. As the New York Times reported, “The commission ended its work without endorsing any recommendations.” The Democrats by and large opposed the plan. And that includes President Clinton, who released a statement warning that the proposal “falls short” and promising to counter with a plan of his own. So to say this plan was “endorsed” by the commission is flatly wrong.
Finally, it was a very different plan. The idea of giving Medicare beneficiaries a choice of private plans in addition to traditional Medicare fee-for-service — in wonk parlance, “premium support” — does have Democratic backers. Some months ago, in fact, I interviewed Henry Aaron, a center-left health-care expert who is one of the idea’s creators. And he said the problem with Ryan’s plan is that it’s not premium support.
Premium support, Aaron explained, was designed to create competition without allowing cost-shifting. The key feature was that payments kept pace with the cost of health care. That way, either there’d be savings from competition, or there wouldn’t be savings. And you can see that in the bipartisan committee’s proposal. They authors write that “on average, beneficiaries would be expected to pay 12 percent of the total cost of standard option plans.” And as far as I can tell, that defined the federal contribution, no matter the growth in health-care costs. You could save money by choosing a cheaper plan, but the government couldn’t save money by simply covering less and less of your costs each year. Premium support, in other words.
That’s not how Ryan’s plan works. For one thing, it eliminates traditional fee-for-service Medicare. For another, Its savings come from capping the growth of federal spending at inflation — which is much, much, much slower than the rate of health-care cost growth. The Congressional Budget Office estimated that, in 2022, Ryan’s plan would have a typical beneficiary shouldering 61 percent of the cost of a standard plan, and by 2030, because the government would limit its contributions, they’d be paying 68 percent. That’s very different than a plan that holds the average contribution to 12 percent of the plan’s cost. But it’s absolutely central to how the Ryan budget saves money. It’s the core of his proposal.
So let’s review: President Clinton did not convene a bipartisan commission on Medicare, the bipartisan commission on Medicare that was convened didn’t endorse the plan, and the plan under consideration was very, very different from the plan Ryan has proposed. This talking point Ryan is trotting out just isn’t true.