While I support Paul Ryan or anyone else coming up with ideas to actually fix Medicare and the federal budget, we still must scrutinize such plans and ask questions aimed at considering unintended consequences. Writing in the August 15, 2012 WSJ Carl Rove says this:
Mr. Ryan’s plan has a different approach. While there would be no changes in Medicare for those 55 or older, starting in 10 years younger Americans would have a choice. They could either pick traditional Medicare or use the average amount of money the government spends on each Medicare enrollee to buy private insurance. The reasoning is based on a reliable truth: Competition will lower costs by using market forces to spur innovation and improvement.
Competition, what competition? The only competition that will lower health care cost is competition among health care providers. Given that the increase in Americans with health insurance will increase demand for health care with no commensurate increase in physicians it seems to me that health care providers will be in the driver’s seat. Of course, if he is talking about competition among insurance companies he doesn’t know what he is talking about.
There is another problem that also needs scrutiny. As any benefits manager knows, when you offer a choice among many health plans there is the risk of adverse selection. That is, the healthy take the plan with the lower benefits and lower cost; the sick take the plan with most generous benefits and fewest restrictions. There is a real chance that under the Ryan plan the adverse selection could be directed toward traditional Medicare.
None of the above changes the fact that Medicare needs some radical changes and the Ryan plan is a place to start serious discussion.
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- Ryan plan for Medicare and you … (quinnscommentary.com)
QUINNSCOMMENTARY 
Mr. Quinn – My cousin’s Humana Medicare Part C premiums are very low and her coverage has been excellent – including a visit to The Mayo Clinic – my BCBS premiums are sky high compared to hers – what am I not understanding? – why shouldn’t everyone chose Humana Medicare Part C coverage? – Thank you
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Well, if Humana is available and meets their needs, perhaps a person should make such a choice. However, there are many variables such as geographic location, choice of doctors (many plans limit that choice to a smaller network) that affect premiums. There is also the matter of market power. The more members a plan has in an area, the more bargaining power it has when negotiating fees with doctors and hospitals. A Part C plan that is not like an HMO, but allows members to go to any doctor and time will usually be more expensive than HMO type plans.
To make a true comparison you have to be sure all variables are the same.
Dick
Richard D Quinn Editor
http://www.quinnscommentary.com
Health Insurance Illuminated http://blog.horizonblue.com/
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Don’t send me any more of this foolosh stuff u keep it
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I beg your pardon, what do you find foolish?
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You vote Obama and you get what you deserve!!!!
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That’s true no matter who you vote for. Not for nothing it has been said that “in a democracy, you get the government you deserve.’ Up or down, good or bad, strong or weak.
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