Where To Find Obama's Medicare Plan

A blog about business and economics.
Aug. 23 2012 1:44 PM

Where To Find Obama's Medicare Plan

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WASHINGTON - FEBRUARY 1: Senator Barack Obama (D-IL) points to a chart about Medicare during a news conference on Capitol Hill February 01, 2006 in Washington, DC.

Photo by Brendan Smialowski/Getty Images

David Brooks says that one of the great virtues of Paul Ryan is that at least he has a plan:

But to be fair Romney and Ryan do have an incredibly brave and sensible Medicare reform package on offer. It’s written down. It’s on paper. I don’t see anything comparably brave from the Democratic side.
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How "brave" a plan is to make Medicare more favorable to the interests of insurance companies and health care providers I couldn't tell you. But the implication here that Obama doesn't have a plan that's "written down" is simply mistaken. Obama's budget ideas are written down exactly where you'd expect them to be, in the Fiscal Year 2013 budget proposal. If you want a proposal for reducing the projected rate of Medicare spending, more specifically under the heading "health savings" starting on page 33. I don't have it in paper, but here's a PDF. You'll see that Obama adopts the exact same GDP + 0.5% growth rate target as Ryan. There are a whole raft of specific proposed changes to premium and payment formulae here and then as a fail-safe proposes more aggressive use of IPAB to ensure that spending doesn't go over the threshold.

My view is that this is actually one of the issues on which there's the smallest gap between Obama's policies and Romney's, since fundamentally they both rely on a kind of X-factor of better bureaucratic management:

Indeed, while at a superficial level there’s a sharp philosophical contrast here between the GOP’s faith in the private sector and Obama’s faith in bureaucratic management in fact but in fact both approaches rely on effective central planning. To make the vouchers work, regulators need to adjust the value of each person’s voucher for age and health status and need to define a minimum acceptable benefits package. Regulators capable of doing that well should also be capable of effectively managing a government-run program and vice versa.

The big difference, I would say, is that Obama's approach is more validated by international experience and basically proposes to make Medicare more closely resemble fixed-budget single payers systems like the one they have in Canada. Ryan's proposal is much more a leap of faith into the workability of an ungainly public-private hybrid but given that this exact same hybrid approach is at the center of the Affordable Care Act it's hardly open to Obama to dismiss it out of hand. But however you look at it, this is very much a real plan—at least as much as Romney's is. 

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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