House Speaker Paul D. Ryan made clear Thursday that he is willing to pursue a major overhaul of Medicare, including changes that could eventually put private companies in charge of the health care for tens of millions of American seniors. But talk of wholesale changes to the popular federal programs has key GOP lawmakers nervous about overshooting their electoral mandate.
“Save Medicare for another day,” said Sen. Lamar Alexander (R-Tenn.), chairman of the Senate Committee on Health, Education, Labor and Pensions. “We want to begin immediately to repeal Obamacare. . . . Trying to deal with the solvency issues with Medicare at the same time falls into the category of biting off more than you can chew. It’s an important issue, it’s one I’m ready to address, but a little humility here would be in order. We can’t do everything at once, and we shouldn’t try.”
Ryan has long advocated for a major Medicare overhaul, one that would convert the 50-year-old public health insurance program for seniors and the disabled into a system that would help beneficiaries purchase private insurance. Republicans tend to call such a model “premium support,” saying it is the best way to control Medicare’s long-term costs, while Democrats refer to it as “voucherization” or privatization and argue that it would mean less comprehensive coverage for vulnerable Americans.
On Thursday, Ryan repeated comments he made shortly after the election indicating that changes to Medicare would have to accompany any effort to repeal and replace President Obama’s Patient Protection and Affordable Care Act. He spoke carefully about how far those efforts might go, but he did not rule out pursuing a premium support model for future retirees — a stance Ryan has held for years, dating back to his days chairing the House Budget Committee, and one that was included in his recent “Better Way” policy agenda.
“We are going to have to do things to preserve and shore up this program,” he said Thursday. “The reforms that we’ve been talking about here in the House Republicans for many years are reforms that do not affect the benefits for anyone in or near retirement. But for those of us who are in the younger generations, the X Generation on down, it won’t be there for us if we stay on the current path. So we have to do things to fix this program so we can guarantee that it’s there intact for current seniors but also that there’s something there for us when we retire.”
Those fixes, he said, “are nothing different than what federal employees have: You get to choose among plans that are comprehensive and guaranteed to meet your benefits. Or if you want to stick with the current traditional program, you can do that as well.” Ryan compared his plan to Medicare Advantage — an option for seniors where the federal government pays a private insurer a flat rate for each beneficiary rather than directly paying a health care provider for services rendered — calling that a program that “works pretty darn well right now, that seniors like.”
Ryan also repeated a frequent talking point, that “Medicare itself is on a path to going bankrupt” though he did not specifically blame the Affordable Care Act as he has in the past. The Washington Post Fact Checker has concluded it is misleading to say that Medicare would go bankrupt and flat-out incorrect to blame Obamacare, which has extended the solvency of the key Medicare Part A trust fund by nine years.
What also has Medicare’s defenders nervous about a push for premium support is President-elect Donald Trump’s intention to nominate Rep. Tom Price (R-Ga.) as his secretary of health and human services. Price succeeded Ryan as chairman of the House Budget Committee, and, like Ryan, he has embraced premium support as a way to roll back federal entitlement spending over the long term.
Also on Thursday, Rep. Kevin Brady (R-Texas), chairman of the tax-writing Ways and Means Committee and a Ryan ally, also told the Associated Press that premium support remained on the GOP agenda, though he said the more immediate priority would be “taking steps, small, in preparing for larger steps to save Medicare for the long term.”
Democrats, eager to seize on an issue important to voters that swung toward Donald Trump this year, have quickly mounted a fierce response to any suggestion that Medicare might be privatized. Sen. Charles E. Schumer (D-N.Y.), the incoming Senate minority leader, accused Republicans of “plotting a war on seniors” this week after Trump announced his intention to nominate Price to his cabinet.
“We say to our Republicans that want to privatize Medicare: Go try it. Make our day,” he said. “We’re going to fight tooth and nail any attempt to privatize, voucherize or any other-ize you can think of when it comes to Medicare. To Republicans considering going down this path, my advice is simple, turn back.”
The treacherous politics of entitlement reform is one reason several Senate Republican polled this week said that they were not eager to pursue major Medicare changes — at least not right away, as part of an Affordable Care Act repeal.
“My guess is, we’ll have our hands full doing what we need to do with Obamacare,” said Sen. Roy Blunt (R-Mo.), a member of the Senate GOP leadership team. “It’s fair to say that Obamacare’s done a lot of damage to Medicare. And because of that, it will necessarily become part of that discussion. But . . . I think it’d be a mistake to talk about specifics right now. We’ve got enough to do focused on first steps on Obamacare and we need to stay focused on that until we get that bill passed, and then we need to start looking at how you repair the damage done by Obamacare.”
Ryan on Thursday accused Democrats of trying to “play Medi-scare politics, which is what they typically do every other Tuesday.” That prompted Schumer to speak up again: “The people who are genuinely and rightly scared are millions of American seniors who don’t believe privatization of Medicare will be in their interest.”
Schumer and other Democrats are set next week to deliver a petition signed by more than a million activists urging Ryan and Republicans to keep their “hands off Medicare.”
Could Republicans, with control of the White House and both houses of Congress, privatize Medicare? They might have to in order to enact a Trump agenda that includes a major tax cut and increased military and infrastructure spending without exploding the national debt.
One major hurdle would be in the Senate, where the are likely to be 52 Republican senators and it typically takes 60 senators to pass legislation of any consequence. However, major parts of a Medicare overhaul — perhaps the entirety of one — could be passed through the budget reconciliation process which reduces the threshold to a simple majority of 50. Compare that to Social Security, the other major driver of long-term federal budget deficits, which is specifically exempted from reconciliation and thus must garner 60 votes.
The other major hurdle is Trump, who on numerous occasions during the campaign said he would not cut Medicare, Social Security or Medicaid, the federal health care program for the poor. Ryan and many congressional Republicans favor significant reforms to all three.
“Every Republican wants to do a big number on Social Security,” Trump said during an April 2015 speech in New Hampshire. “They want to do it on Medicare. They want to do it on Medicaid. And we can’t do that.”
“I’ll save Medicare,” he said in a Fox News Channel interview the following November. “You don’t get rid of Medicare. You can’t do that. People love Medicare, and it’s unfair to them.
But while Trump has never endorsed any specific Medicare reforms beyond eliminating waste, fraud and abuse, the health care agenda posted on his transition website includes this cryptic item: “Modernize Medicare, so that it will be ready for the challenges with the coming retirement of the baby boom generation — and beyond.”
Ryan said Thursday he has not discussed Medicare with Trump, but he left the door open to use budget reconciliation to aggressively pursue GOP policies.
“This is our intention — to use every tool we’ve got to make progress for the American people, to make good on the promises that were made,” he said.