Paul Krugman once again explains today in the New York Times what a government check to buy health insurance from companies that can reject you for any reason, charge you exorbitant premiums if they take you, and drop you at any time for any reason (because "take all comers" is part of the Affordable Care Act that Ryan wants to repeal) will mean in real life for real people:
Medicare is a government-run insurance system that directly pays health-care providers. Vouchercare would cut checks to insurance companies instead. Specifically, the program would pay a fixed amount toward private health insurance — higher for the poor, lower for the rich, but not varying at all with the actual level of premiums. If you couldn’t afford a policy adequate for your needs, even with the voucher, that would be your problem.
And most seniors wouldn’t be able to afford adequate coverage. A Congressional Budget Office analysis found that to get coverage equivalent to what they have now, older Americans would have to pay vastly more out of pocket under the Paul Ryan plan than they would if Medicare as we know it was preserved. Based on the budget office estimates, the typical senior would end up paying around $6,000 more out of pocket in the plan’s first year of operation.
By the way, defenders of the G.O.P. plan often assert that it resembles other, less unpopular programs. For a while they claimed, falsely, that Vouchercare would be just like the coverage federal employees get. More recently, I’ve been seeing claims that Vouchercare would be just like the system created for Americans under 65 by last year’s health care reform — a fairly remarkable defense from a party that has denounced that reform as evil incarnate.
So let me make two points. First, Obamacare was very much a second-best plan, conditioned by perceived political realities. Most of the health reformers I know would have greatly preferred simply expanding Medicare to cover all Americans. Second, the Affordable Care Act is all about making health care, well, affordable, offering subsidies whose size is determined by the need to limit the share of their income that families spend on medical costs. Vouchercare, by contrast, would simply hand out vouchers of a fixed size, regardless of the actual cost of insurance. And these vouchers would be grossly inadequate.
Mr. Brilliant and I have insurance through my employer, which has just made available a full wages and benefits statement so that we know at any time just what the company pays for the various benefits we have. The health plan we have, which pays 90% of "usual and customary" (read: ridiculously low) to in-network providers with a $500 per person deductible every year but covers preventive procedures such as mammograms and colonoscopies and routine physical exams at 100% to in-network providers, costs about $13,000/year. I pay about $3600 of this premium.
An individual policy at this level would cost far more. Perhaps some of you who DO purchase individual policies might want to weigh in with what your coverage is and at what cost. I'm guessing that right now, at my age, a similar policy would probably cost upwards of $20,000/year -- if we could even get one. Now imagine me in ten years, at age 66, trying to buy an individual policy from an industry that has been cherry-picking for years.
Republicans are painting the Ryan plan like an all-you-can-eat buffet, in which America's senior will have a vast array of health insurance "products" from which to choose, offered by a wide variety of providers who are just salivating at the thought of getting hold of all those people who are going to need actual payouts for health care. In what kind of universe does anyone actually believe this to be true?