Discussing the Premium Support Proposal


Uploaded by MedicareRightsCenter on 07.05.2012

Transcript:
These days there are so many proposals about controlling costs of medicare that it's hard to keep track.
The subject of this video is Premium Support,
and this is likely the proposal that would most significantly impact people with Medicare.
We call a Privatization, Voucherization, Defined Contribution or Premium Support.
Over the past few years all of these terms and others have been used to describe certain Medicare proposals,
but regardless of the terms used, these proposals would all significantly change the Medicare program in the same underlying way.
Under a premium support system, the government would provide Medicare beneficiaries with a capped amount of money,
also referred to as a voucher, to buy insurance offered by private companies or under Original Medicare as well.
Specifically, because many of these proposals include a cap or a limit on government Medicare spending that grows more slowly than actual health care costs,
this proposal would significantly increas out-of-pocket costs for people with Medicare.
In other words, the value of the voucher provided by the government would not keep up with real medical costs.
As a result, people with medicare would be required to make up the difference with their own money.
It's important to understand that most people with medicare live on very limited incomes and are not usually in a position to pay more.
For example, half of those with medicare live on incomes of $25,000 or less per year,
and on average, Medicare household already spend fifteen percent of their incomes on health care costs.
This is three times as much as the non-medicare population.
Plain and simple, if people with Medicare can't afford care, they just don't get it.
Furthermore, while some proposals only allow beneficiaries to use vouchers to purchase private plans,
others allow you to purchase original medicare as an option
However, under these proposals Original Medicare would likely be severely weakened and cost beneficiaries more than it does today.
These proposals give private plans great flexibility in their benefit design
and they could attract healthier individuals who require less care.
Because Original Medicare would provide better coverage for those with serious health conditions,
its risk pool would likely have a greater number of people with serious in illness serious illnesses and conditions.
Consequently, those with original medicare, including those in the program today, would ultimately be subject to higher costs as Original Medicare, which serve a population that is older and more costly.
The goal of these proposals is to save the government money not to make health care better,
but they do by shifting all the costs onto Medicare Beneficiaries.
Premium support proposals do nothing to address the root cause of growing costs under the program, which is the rising costs in healthcare sector overall.
In fact, Medicare is more efficient and has a lower per enrollee growth rate then its private counterparts.
From 2002 to 2009 Medicare spending grew 4.6% per enrollee compared to private insurance, which grew by 6.7% for similar benefits.
Recently the House of Representatives approved a budget authored by Congressman Paul Ryan that included a premium support proposal
This budget would end the Medicare program as we know it today.
Although it is unlikely that this budget will become law this year,
premium support was also included in last year's budget
and will continue to be a major part of the Medicare discussion this year and in years to come
Just because a policy does not become law this year,
doesn't mean it can't become law next year
Therefore, it's important that we all understand what is at stake for Medicare and have context for discussions we here in the news and among our friends
We need to ensure Medicare exists forfuture generations,
but that means preserving access to affordable, quality and comprehensive coverage
and looking to solutions that don't unfairly put the burden on the backs of those who are least able to shoulder it.
Thank you very much.