The truth about Paul Ryan and his Medicare reform

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People on both sides of the aisle want to know why a progressive
Democrat is working with the author of last year's House Budget on
Medicare reform. Here's why:

When I was 27 years old,
I organized legal aid clinics to help low income seniors. It was a
life-altering experience. I'd be invited into someone's home and after
coffee and a few stories about the grandkids or the Great Depression,
my host would reluctantly pull out a shoebox, swallow his or her pride
and ask for my help.

The shoebox would be full of supplemental Medicare insurance
policies. Often there were more than ten separate policies. These
policies were supposed to cover the benefits, co-pays and deductibles
that Medicare didn't, but most weren't worth the paper they were printed
on. Unscrupulous insurance agents would prey on a senior's health
concerns and fear of being a burden on loved ones in order to extract
monthly payments often for multiple policies that offered benefits that
the senior already had, didn't need and usually couldn't afford.

The victims of these scams -- seniors who had lived through two world
wars -- would look at me with shame in their eyes and tell me that they
should have known better.

Stopping those insurance rip-offs was one of the reasons I ran for Congress.

Fighting for Seniors

It took a little over a decade to build a coalition strong enough to
beat the insurance companies, but in 1990, then Senator Tom Daschle and I
passed a law regulating the private market for supplemental Medicare
insurance policies. We created benefit standards
so that seniors would know exactly what they were signing up for and we
imposed heavy fines on anyone who took advantage of seniors. That
Medigap law is still the model for consumer protection today.

I did not stop fighting for seniors there. In the early 1990s then
Representative Olympia Snowe and I were among the first to propose bipartisan legislation
to add a prescription drug benefit to Medicare. When a Medicare
Prescription Drug benefit was ultimately added to Medicare, Senator
Snowe and I began pressing for legislation that would empower Medicare to use its market power to negotiate the best prices for seniors.

Congressman Ed Markey and I authored a law to create Medicare's first home-based health program for seniors with chronic illnesses.
I've written and passed laws to give Medicare beneficiaries access to
life saving cancer drugs and to ensure that seniors don't have to give
up the prospect of a cure when they go into hospice care. The Department of Health and Human Services recently reported that -- thanks in part to a reform I authored in the Affordable Care Act -- Medicare Advantage premiums are down, enrollment is up and more and more seniors have quality health coverage.

In just the last year, I have introduced legislation to expand a senior's choice of mental health professionals, reduce Medicare fraud and bring transparency to Medicare payments. I also authored a discussion paper with Chairman Paul Ryan exploring ways in which Democrats and Republicans might work together to ensure a sound future for Medicare.

The Medicare Guarantee is at Risk

I know that polls show that the majority of Americans like Medicare
the way it is today. But don't let that number confuse what's at stake:
unless Congress enacts meaningful Medicare reform in the near future,
seniors will be faced with inevitable cost-shifting and eventual benefit
cuts until Medicare doesn't look anything like the program does today.

The Congressional Budget Office projects that the Medicare Hospital Trust Fund will be out of money by 2022. And as MedPac explained in its report to Congress last year,
Congress's continued inability to come up with a long term solution for
Medicare's reimbursement rate for doctors "is undermining confidence in
the Medicare program."

Last year, Congress passed a mere 60-day extension of Medicare
physician pay rates in order to avoid asking doctors to swallow a 27.4
percent cut to Medicare physician pay. Although a 'deal' was eventually
reached to pay doctors for their services through the end of this year,
chronic payment uncertainty and already low reimbursement rates are
forcing more and more doctors to consider dropping or limiting the
number of Medicare patients they are willing to treat. This is a
significant problem given that retiring Baby-Boomers are no longer a
theoretical problem. Starting this year, an average of 10,000 Americans
will enroll in Medicare each day for the next 20 years.

The Medicare Guarantee is Our Nation's Most Solemn Promise

I believe the most important aspect of Medicare is not the structure
of the program but the guarantee to all Americans that they will have
high quality health care as they get older. I will always fight to
protect traditional Medicare, but in my mind, what makes Medicare so
important is its guarantee It is one of our nation's most solemn
promises and history has shown what can happen when it doesn't exist.

Before Congress created Medicare in 1965, more than 50 percent of
American seniors didn't have health insurance, mostly because of its
unaffordable cost. It was not uncommon for the sick elderly to be
treated like second class citizens, and as a result, many aging
Americans without family to care for them, ended up destitute without
necessary health care, or on the street. It was a disgraceful time in
our nation's history; we must take steps to ensure that it never happens
again.

Traditional Medicare Doesn't Work the Same for Everyone

Contrary to popular belief, every Medicare beneficiary is not
currently enrolled in Medicare's government-administered health
insurance plan. In Oregon, for example, 56 percent of seniors
currently get all or some of their health coverage from a private plan.
(15 percent of Oregon seniors purchase private Medigap policies to
supplement their traditional Medicare, while 41 percent of Oregon's
Medicare beneficiaries are enrolled in private health insurance plans
through Medicare Advantage.) It is worth noting that many Medicare
Advantage plans in Oregon save money over traditional fee-for-service
Medicare.

While most seniors are very happy with the Medicare benefits that
they get from the government, it is important to remember that Medicare
isn't perfect and doesn't work the same for everyone.

For example, traditional Medicare does not offer catastrophic
coverage or dental benefits. To get those options, seniors have to pay
for supplemental private insurance. While many private plans offer the
option of prescription coverage as part of their insurance packages,
under traditional Medicare, seniors have to sign up for those benefits
separately. While some seniors like the freedom Medicare gives them to
find and choose their own participating doctors, some prefer an
integrated private health plan that has identified a network of doctors,
testing facilities and pharmacies that work together, collaboratively
on the needs of their enrollees .

And again, just because you are enrolled in Medicare's
government-administered option does not mean that you are guaranteed to
find a doctor willing to take on new Medicare patients. Seniors in
historically-low reimbursement states like Oregon have long had
difficulty finding doctors and more and more seniors in other parts of
the country are starting to encounter this problem. For this reason,
many seniors in Oregon have been grateful to learn that Medicare gave
them the option of enrolling in a private plan.

Finally, Medicare's copays and deductibles are not insignificant for a
senior living on a fixed income, regardless of plan choice. While
Americans under the age of sixty-five pay an average of 3 percent of
their total income on health care, Americans over the age of sixty-five
are spending 16 percent of their total income on their health needs. It
is projected that by 2020, that number will reach 26 percent. With
nearly 62 percent of seniors living on incomes of less than $30,000
annually, this is particularly worrisome no matter what it says on a
beneficiary's Medicare card.

Not All Plans that Include Private Insurance Choices are Created Equal

While allowing seniors to choose between traditional Medicare and
privately-administered health plans would not "end Medicare as we know
it," (since this choice already exists in Medicare) changing the program
in a way that would undermine or end the Medicare Guarantee certainly
deserves that description.

There is no question in my mind that last year's House Republican
Budget would have ended the Medicare Guarantee, that is why I voted
against it. Not only did the Republican plan eliminate Medicare's
traditional government-administered insurance program, it failed to
include tough consumer protections for seniors. The vouchers it would
have given seniors to purchase health insurance weren't guaranteed to
cover the cost of health insurance over time. Seniors aren't guaranteed
to have health insurance if affordability isn't guaranteed as well.

Voters would be right to consider their representative's vote on that
budget as an indication of their representative's commitment to the
Medicare Guarantee. Put simply, if you want to be sure that your Member
of Congress will not vote to end the Medicare Guarantee in the future,
you would probably be better off with a representative who didn't vote
to end it in the past.

But doing nothing is also a direct threat to the Medicare Guarantee.
Congress must pass meaningful reform within the next few years and
since it is highly unlikely that Democrats are going to win a super
majority of seats in both the House and the Senate this year, the only
way to pass legislation upholding the Guarantee is for Democrats and
Republicans to work together. To protect Medicare, we have to get the
dangerous ideas off the table and start looking for solutions that will
ensure that seniors will always be able to get the care they need.

This is why I started talking to Paul Ryan about Medicare.

What Wyden-Ryan Really Says

There have been a lot of mischaracterizations. So, let's be clear about what the Wyden-Ryan plans really says.

Wyden-Ryan doesn't eliminate the traditional Medicare plan, instead
it guarantees that seniors who want to enroll in Medicare's traditional
fee for service plan will always have that option.

Wyden-Ryan doesn't privatize Medicare because Medicare beneficiaries
already have the option of enrolling in private health insurance plans.
Wyden-Ryan makes those private plans more robust and accountable by
forcing them to -- for the first time -- compete directly with
traditional Medicare.

Wyden-Ryan protects the purchasing power of traditional Medicare and
private sector innovation to make both types of Medicare stronger and
more senior-friendly. All participating private plans will be required
to offer benefits that are at least as comprehensive as traditional
Medicare and any plan that is found taking advantage of seniors or
providing inadequate care will be kicked out of the system. Cherry
picking healthier seniors will be made unprofitable by a robust
risk-adjustment mechanism and policed by the Medicare administrators.

Wyden-Ryan would also uphold the Medicare Guarantee by ensuring that
seniors will always be able to afford their health benefits. Unlike a
voucher program that would give seniors a fixed amount of money to
purchase health plans, Wyden-Ryan would adjust premium support payments
each year to reflect the actual cost of health insurance premiums. In
addition, low income seniors, including dual-eligibles will receive
additional benefits to cover out of pocket costs - ensuring that seniors
have the same choices regardless of income. Yes, if private plans are
able to devise a way to provide the same health benefits as traditional
Medicare for less money, a senior might have to pay extra if he or she
still wants to enroll in the government option. But if you could get
the exact same benefits for less money, why would you want to pay more?

Beyond that, Wyden-Ryan creates a catastrophic benefit that does not
exist in traditional Medicare, ensuring that no senior is bankrupted by a
major illness.

Finally, Wyden-Ryan isn't a piece of legislation. It does not
include legislative language or specifications detailing exactly how the
system would work. If Wyden-Ryan or something like Wyden-Ryan gets to
the legislative stage, those specifications will be important to get
right as the devil is always in the details. Right now, however,
Wyden-Ryan is simply a policy paper intended to start a conversation
about how Democrats and Republicans might work together to uphold the
Medicare Guarantee.

Using Wyden-Ryan for Political Cover Harms Seniors

Yes, just as some in my party criticize Wyden-Ryan without knowing
what the plan really does, some Republicans will undoubtedly declare
their support for Wyden-Ryan without knowing what that means or
believing in its principles. Mitt Romney, for example, claims to have
helped write Wyden-Ryan even though I have never spoken to him about
Medicare reform and have yet to hear him declare that there should
always be a role for traditional government-run Medicare.

Those who say they support Wyden-Ryan simply for political cover are
neither helping seniors nor being bipartisan. Rather, using Wyden-Ryan
for political purposes harms seniors by making a bipartisan agreement to
uphold the Medicare Guarantee that much harder. Anyone who does this
deserves to be called out on it.

However, by that same token, those of us who care about the Medicare
Guarantee shouldn't discourage Republicans from working in a bipartisan
way to preserve the program in the future. Even though it might blunt
some political attacks, we should be encouraging Republicans to take
dangerous reforms off the table and pledge their support for Medicare.
Just as we should be working to educate our conservative colleagues
about the importance of a program many of them clearly don't understand.
The upcoming election is important, but after the election, we're
going to have to pass Medicare reform and that is going to require us to
work together.

This week, Congressman Ryan will be unveiling the House Republican
Budget. I do not know know what the details of the budget will be. I
didn't write it and I can't imagine a scenario where I would vote for
it. I do know, however, that because we worked together, Paul Ryan now
knows more about the Medicare Guarantee and protecting seniors from
unscrupulous insurance practices than he did before. If that is
reflected in his budget this year, as someone who has been fighting for
seniors since he was 27 years old, I think that's a step in the right
direction.