Wednesday, May 25, 2011

GOP Budget Czar Paul Ryan has trouble telling the truth

Jared Bernstein, former chief economic aide to VP Joe Biden, comments on Congressman Paul Ryan's assertion that ”Our plan is to give seniors the power to deny business to inefficient providers...their plan [Affordable Care Act] is to give government the power to deny care to seniors”:

"What's up with this guy?"
The ACA does nothing of the sort.  It was structured precisely to ensure that the fundamental guarantee of Medicare remained in place.   This link, from Austin Frakt, provides the details.  The punchline is that IPAB—the Independent Payment Advisory Board created by ACA to control cost growth—is explicitly not permitted to “…ration health care, raise costs to beneficiaries, restrict benefits, or modify eligibility criteria.”

So Ryan is wrong.  Full stop.

But there’s more.  Understanding this difference provides a useful insight into how health care reform under the ACA differs from Ryan’s approach.  ACA gets under the hood of the health care delivery system to attempt to control health-care cost growth.  Ryan simply shifts cost growth from the government to seniors.

As explained in the link above, the IPAB is a mechanism to control the cost growth of Medicare, to enforce, for example, the cost effectiveness I talk about here.  I recognize that one can twist this search for more efficient health care delivery into Ryan’s accusation, but there is a fundamental difference between “denying care” and insisting on cost effective care.

There is no insurance system in the world that now or ever could provide anything and everything to everyone who wants it.  Every such system is making such decisions all the time as any self-reflection on your own plan, if you’ve got one, will tell you.  If it works, the IPAB will force the system to make better decisions.

And if you think that’s a reach, remember this: every other advanced economy spends one-half to two-thirds what we spend (as a share of GDP) on health care with similar if not superior outcomes.
The fundamental problem here is that arithmetic is unforgiving: if health care spending per person keeps growing a few percent faster than GDP per person, it means that each year we spend a larger share of our national income on health care and less on everything else.  And given that half of our health care spending is public spending, in the absence in the absence of an IPAB or similar mechanism to break this pattern, we cannot achieve a sustainable budget.

And this is by no means solely a public sector problem.  In the private-sector half of our health spending—outside of M-care and M-Caid—costs are growing even faster than on the public side.
As we've said time and again, there isn't a Medicare cost crisis. There's a health care cost crisis that will be with us and affect every aspect of our health care choices - public and private.  Medicare is the most cost-effective sector of health care insurance - which of course defies the logic of the wacky privatization and voucher proponents like Ayn Rand-acolyte and GOP Budget Czar Paul Ryan.  All other advanced industrialized countries with higher quality health care results have gone much farther in controlling their system's costs by increasing the government's role in regulating and rationalizing universal coverage, not by increasing  privatization and putting faith in "markets" as a catch-all fantasy for cost-containment.  These characters are - literally - reduced to making things up, from false promises to false charges.

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