|Obama vs. Ryan Budgets: A Contrast of Visions|
|BY ASHTON ELLIS |
WEDNESDAY, FEBRUARY 15 2012
To read President Obama’s 2013 budget proposal regarding Medicare and Medicaid in light of Rep. Paul Ryan’s more flexiblealternative is to see a startling contrast of visions.
On Page Four of President Obama’s Budget Message to Congress, there is a thinly veiled swipe at Rep. Paul Ryan’s plan to reform Medicare and Medicaid: “What [my proposal] does not do – and what I will not support – are efforts to turn Medicare into a voucher and Medicaid into a block grant.” Obama’s stated reason for shoving Ryan’s ideas off the negotiating table center on the liberal belief that giving individuals (Medicare) and states (Medicaid) more flexibility to use federal subsidies amounts to a broken promise “made to American seniors, people with disabilities, and low-income families.”
What promise is the President talking about? Is it the promise to saddle multiple generations of Americans with trillions of dollars in debt? Is it the promise to cut the fair market compensation rate to doctors so that taxpayers don’t feel the sting of the government’s largesse? Is it the promise to distort the true cost of health care with policies that incent the overconsumption of drugs and products while patients are turned into widgets to be serviced rather than people to be treated?
No, all of those “promises” are upheld and extended in President Obama’s budget. From Pages 111 to 113, the President treats doctors and patients – rather than the current structure of Medicare and Medicaid – as the problem.
Regarding Medicare, doctors will be subject to another layer of compliance costs with the addition of new anti-fraud measures. Patients will be expected to pay more for services, as funding for various Medicare plans is cut.
On the Medicaid side, states are promised less complicated reimbursement formulas, but the essential deficiency of the program remains: escalating funding for expanding services. States are drowning in red ink because federal funds are matching funds, meaning that states must spend money to get money. This is why taxes for everyone will go up. It is also why Medicare and Medicaid are the fastest growing budget items for federal and state governments.
In a perfect world, state governments would refuse further federal funding and the mandates for spending and regulation that come with them. However, the world is far from ideal and even 70 percent of self-described Tea Party members told a Marist poll last spring that they do not support spending reforms for Medicare. But while the vast majority of Americans have grown accustomed to the benefits associated with government subsidized health care, they are not (yet) predisposed to government-run health care.
This is the genius of the policy compromise struck by Paul Ryan last year. Unlike President Obama, Ryan does not reject out of hand a reasonable middle-ground approach to reform. Ryan’s proposal to turn Medicare into a premium support voucher retains the essential purpose of Medicare to provide a government health subsidy to the elderly. That’s smart politics. But it also caps the dollar amount and gives beneficiaries an incentive to spend their subsidy with greater care because there will be a limit on government assistance. That’s sound policy.
The same is true of Ryan’s Medicaid reform. Instead of incenting budget-busting spending tied to federal priorities, states will get block grants with drastically reduced restrictions on how to spend the money. The emphasis is on flexibility and performance, not ticking boxes on a bureaucrat’s checklist. It should go without saying that health care spending in California will differ greatly from Kentucky, but liberals need to be reminded daily that local problems require local solutions, even if federal tax dollars are involved.
Runaway government spending is the greatest issue confronting our nation today. Getting control of entitlement costs like Medicare and Medicaid is essential to restoring America’s fiscal integrity. Paul Ryan thinks the individuals closest to the end user are best positioned to make the smartest decisions about costs and benefits. Barack Obama wants faraway federal bureaucrats making those calls. The contrast of visions is really that simple.