Obama says Ryan plan ‘will control costs’

Neil Munro White House Correspondent
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The GOP’s Medicare reform plan is putting Democrats on the defense, prompting the White House to turn up the volume on its claim that government experts can be trusted to manage the medical sector.

The GOP plan “will control costs,” President Obama said at the April 20 town-hold hosted by Facebook. Except, he added, “if you get sick and the [commercial health-insurance] policy that you bought doesn’t cover what you’ve got.”

Republicans, he said,  “don’t really want to make the healthcare system more efficient and cheaper… what they want to do is to push the costs of healthcare inflation on to you.” The better solution, Obama said, is a government-managed system. “If we’ve got healthcare experts — doctors and nurses and consumers — who are helping to design how Medicare works more intelligently, then we don’t have to radically change Medicare.”

“Rationing care from Washington bureaucrats is not the answer to fixing Medicare,” budget committee chairman Rep. Paul Ryan said in a statement to The Daily Caller. “Empowering individuals and personalizing Medicare is needed to ensure this program is stable and secure for current and future beneficiaries.”

On Wednesday, the two Republican chairmen of the House Ways and Means Committee and the House Energy and Commerce Committee asked the White House to explain the President’s recent suggestions that the Independent Payment Advisory Board be given more power to cut medical spending.

The committees are trying to reform the fast-growing Medicare program, and “we require much more information before we can properly consider the savings targets you have proposed,” wrote Michigan Reps. Dave Camp and Fred Upton. “We ask that you provide this additional clarification so that we can fully understand and evaluate the new Medicare proposals you have put forward.”

The IPAB was established by the Democrats’ Obamacare bill to control health-care costs by denying or approving medical payments for Medicare services. It does not have authority over the non-Medicare programs, but Obama suggested in his April 13 speech that its role be expanded to help reduce the annual deficit.

In the same speech, given last Wednesday to the students at George Washington University, Obama also suggested that the panel could help cut $340 billion in Medicare and Medicaid costs by 2021, another $480 billion in the next two years, and more than $1,000 billion in the following decade. Democrats have already agreed to cut $500 billion in future spending from Medicare’s complementary program, Medicare Advantage, as part of Obamacare, which expands federal control over the health-care sector.

If all those cuts are enacted, Democrats would have cut more than $1,000 million from Medicare programs over 12 years.

The cuts envisaged by the Democrats are “record-breaking cuts,” said Robert Moffit, the director of the Center for Health Policy Studies at the right-of-center Heritage Foundation. In practice, the cuts will reduce the number of doctors willing to provide Medicare services, forcing Medicare recipients to wait. ‘“The benefits will be there [on the books], but you’ll have to find a doctor that will provide the benefits for you at below-market prices…. it will look like the British National Health Service,” he said.

The letter sent by Camp and Upton to the White House asks the President to fill in the blanks on his deficit-reduction speech, which is widely expected to at the core of his reelection strategy. “Do you recommend making all [medical] providers subject to IPAB cuts beginning in 2014?… what specifically do you mean by ‘giving the IPAB additional tools to improve the quality of care while reducing costs’[?]… Would this require a statutory change?”

Their letter also asked for clarification of other elements in Obama’s fiscal framework, including a call by the President for government to use its purchasing-power to cut the price of health-care drugs.

Over the last week, Democrats have heavily criticized Ryan’s plan, which charts a plan between fiscal restrain and political caution. Obama led the criticism, claiming in his deficit speech that Ryan’s budget plan is “un-American… [and] would lead to a fundamentally different America than the one we’ve known – certainly in my lifetime… It says, instead of guaranteed health care, you will get a voucher. And if that voucher isn’t worth enough to buy the insurance that’s available in the open marketplace, well, tough luck – you’re on your own.”

The criticism of Ryan’s plan has been so consistent among Democrats that Newsweek’s Evan Thomas tagged it as a partisan push for the 2012 election. “Democrats will now accuse the Republicans – it’s an old page in their playbook – of throwing Granny in the snow” until the 2012 election, he said.

Ryan’s plan, dubbed the Path to Prosperity, would provide new recipients of Medicare after about 2021 with a voucher that could be used to buy health-care from on the open market. This reform would allow Americans to make health-companies compete on price, boost the quality of health-care and also reduce government costs, say advocates.

But Democrats are sticking by their preference for expert control of health-care. The IPAB is “is a panel of experts that would set constraints on spending in these programs,” said Jacob Lew, the director of the White House’s Office of Management and Budget. “It would limit the growth in the programs to a level that would require changes in reimbursement practices and the like… It is a very real set of policies, “ Lew told reporters attending an April 14 press conference at the White House.

“We’ve put in motion the most sweeping policy changes that would give us in fact the ability to what we call bend the cost curve, lower the cost growth of health care in this country… It’s the answer to how do we deal with the problems of health care expenses in the economy generally,” Lew said.

“We can change our healthcare system … to actually make the healthcare system more efficient, making it work, using things like health [information technology], and making sure that providers are reimbursed in smarter ways, to bend the cost curve on health care, so it’s available for the next generation,” President Obama said in an April 20 speech to donors at a California fund-raiser. “That’s a fundamental choice, a fundamental distinction in terms of how we see the future.”

But the IPAB is “an unelected board of ‘experts’ tasked with squeezing savings out of Medicare through formulaic rationing,” said Ryan’s statement. “One-size-fits-all decisions to restrict certain treatments punish beneficiaries by hitting all providers with across-the-board cuts, with no regard to measures of quality or patient satisfaction… The Path to Prosperity would eliminate IPAB.”