Becoming the only other lawmaker to do so, Sen. Joe Lieberman (I-Conn.) joins Rep. Paul Ryan (R-Wis.) in eschewing demagoguery and offering a plan for reforming, and hence saving, Medicare. The Lieberman plan has the benefit of recognizing that we have a real problem and that Medicare “as we know it” will collapse:
Bottom line, Medicare is hurtling toward its demise — our government is approaching a cataclysmic fiscal tipping point — while Washington is busy posturing for the next election.
He takes a different approach than Ryan, bu he’s not buying into the White House line that Obamacare “already” fixed Medicare. Lieberman’s plan has these components: 1)“raising the Medicare eligibility age every year starting in 2014 by two months until it reaches 67 in 2025”; 2) “implementing a single, combined Part A and Part B deductible, requiring a co-pay on all Medicare services and adding a maximum out-of-pocket benefit that will give seniors peace of mind by promising them that they will not have to pay more than a set amount of their health-care costs annually”; 3) raising “the premiums for all new enrollees in Part B (doctor’s services) and Part D (prescriptions) starting in 2014 to 35 percent of program costs”; 4) reforming Medigap policies; and 5) raising taxes on “higher-income Americans [who will] pay an additional 1 percent of every dollar they earn over $250,000 to help save the program.”
I imagine the left will hate this far more than the right. Lieberman’s plan is in some ways more disruptive than Ryan’s because it requires those under age 55. and not just well-off seniors, to start paying more for their own health care. In essence, these are the more radical measures we would have to resort to if the Ryan plan doesn’t work. Moreover, Lieberman himself concedes his plan only buys another 20 years for the program. What then?
Conservatives will, of course, object to the revenue element. They are also likely to point out that the Ryan plan offers the sort of gradual, nondisruptive reform that the Lieberman plan accepts as an unfortunate necessity. Yuval Levin, writing in the Weekly Standard, explained the “radical gradualism” of Ryan’s approach to the debt problem. Specifically, on Ryan’s Medicare plan, which doesn’t kick in for 10 years, he wrote:
If you believe we confront an urgent crisis, why would your most significant proposal be put on hold for a decade, and exclude today’s retirees and near-retirees? Because Ryan’s basic goal is to avoid a disruptive shock in American life. His transformation of Medicare aims to allow those who have made long-term plans around certain expectations to keep those plans, and to allow others to make their own plans around the new arrangement. The 10-year lag is thus a crucial part of the reform, and the clock must start soon because waiting would mean that when the programs are forced to change, the change would have to be sudden and harsh.
From my perspective, there is a great deal that is positive in Lieberman’s plan. The notion that seniors have to take more responsibility for their own health care is critical to reworking the system into a viable plan that can be sustainable in the long run. Lieberman avoids the charges of “privatization” but in fact makes Medicare more akin to private plans, which don’t pay 100 percent of costs. And from a political perspective, he highlights that Ryan’s plan is the most gradual plan out there.
While I and other conservatives question whether Lieberman’s plan is a long-term fix for the system and object to the tax elements (unless, for example, they are offset by lower marginal tax rates), Lieberman should be praised for presenting a credible proposal. If Democrats in Congress and the White House would likewise acknowledge that Medicare “as we know it” is going away and that seniors must absorb more of their own health-care costs, we might actually make some progress. I suspect, unfortunately, that Lieberman will be a lonely figure; the issue is too attractive for the Democrats to demagogue. I would not expect a grand bargain on Medicare before 2012.