Study: Medicare Premiums Would Rise for 59% With Ryan Plan

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People listen as Republican Vice Presidential candidate, Rep. Paul Ryan speaks during the Victory Rally in Florida at Town Square, Lake Sumter Landing on August 18, 2012 in The Villages.Ryan spoke about his family's reliance on Medicare.

Elderly people in Florida would have paid more than $200 extra for traditional Medicare if a system similar to Paul Ryan’s proposed overhaul of the program had been in place in 2010, according to researchers at the nonprofit Kaiser Family Foundation.

Ryan, the Republican vice presidential nominee, has proposed transforming Medicare into a “premium support” system in which beneficiaries get a fixed payment from the government for their health insurance, instead of guaranteed benefits. Such a plan would lead to wide variations in the cost of Medicare across the country, according to the Kaiser study reported today.

Fifty-nine percent of Medicare beneficiaries would have paid more in 2010, unless they switched from traditional Medicare or their current private coverage to a lower-cost plan, the researchers found. In California, Florida, Michigan, New Jersey, Nevada and New York, it would cost more than $100 extra a month to maintain traditional coverage for Medicare.

The findings “underscore the potential for highly disparate effects of a premium support system for beneficiaries across the county,” said the authors, led by Gretchen Jacobson, a policy analyst at Kaiser.

A campaign spokesman for Ryan, Brendan Buck, didn’t immediately comment in an e-mail.

Under the plan outlined by Ryan, who is also the House Budget Committee chairman, the government’s contribution to Medicare would be set by annual bids from plans participating in the system, including traditional Medicare. The stipend, which Democrats call a “voucher,” would equal the second lowest-cost bid in each county.

That mechanism would lead to varying premiums across the country because of differences in medical costs, Jacobson and her colleagues said. Medicare would likely be among the lowest-cost plans in parts of the country with low medical costs, while private plans would outbid the government elsewhere.


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