Mr. Ryan’s budget, which the House passed, is wanting in many ways, as we’ve noted. It would expand the nation’s debt because it doesn’t acknowledge the need for more revenue. It contains far too much risk of harming the most vulnerable.
But it’s honest enough to acknowledge that simply preserving Medicare as we know it is not an option. Society is aging and health-care costs are rising so fast that, absent some change, Medicare will gobble up the biggest share of federal spending.
Mr. Ryan’s solution is to change Medicare from a fee-for-service system, under which it pays most of the cost of whatever is deemed medically appropriate, to a system in which the government pays a set amount toward seniors’ purchase of health insurance coverage from among competing providers. Older, sicker and poorer people would receive larger subsidies.
The hope is that by introducing competition and giving seniors an incentive to avoid unnecessary care, costs can be controlled. The worry is that over time government support will be too stingy for seniors to afford coverage. But the concept is hardly beyond the pale — as past support for it, in some form, from Democrats such as budget expert Alice Rivlin and former senator John Breaux suggests. The principle undergirds how Medicare pays for drugs and resembles how the Obama health plan would subsidize insurance on market exchanges for some non-senior adults.
For its part, the Obama administration’s cost-control efforts would rely more heavily on streamlining and improving the delivery of medical services and on an expert panel with fast-track authority to come up with further measures if cost growth remains excessive.
Ideally we’d have a debate about the relative merits of these proposals, or of possibly combining both. It’s reasonable for each side to point out the dangers of the other approach. Instead, Republicans demagogue against the commission as a national “rationing board” of unelected bureaucrats, as Senate Minority Leader Mitch McConnell (R-Ky.) and House Speaker John A. Boehner (R-Ohio) have described it. Democrats do the same for Mr. Ryan’s premium support plan; Health and Human Services Secretary Kathleen Sebelius told a House panel that seniors would “die sooner.” The Democratic National Committee proclaimed in an ad: “Their leaders have called for cutting Medicare, and now for killing it.”
This is false, inflammatory and, as we said, useful — for winning elections, that is. When it comes to solving the government’s most pressing problem, it threatens to set things back.