Karl Rove wrote on his blog August 16 that
"... 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."
Rove's got it almost as wrong as Joe Biden and Paul Krugman. He's wrong two ways:
No one can
"use the... money... to buy private insurance."
That is simply not the way the Wyden-Ryan Medicare Reform proposal works. Read the proposal, dammit! (Oddly, for the best explanation of the way Wyden-Ryan competitive bidding and premium support would work, see the work of The Three (Harvard) Amigos. The Harvard assumptions and their conclusions are all wet but they do explain the Wyden-Ryan bidding process correctly.)
Second, if the reform was based on
"the average amount of money the government spends on each Medicare enrollee..."
it would never save any money. The idea is to get the cost down, not keep it average. Again THe Three Amigos illustrate why that will happen.
A good number of plans will provide exactly the same benefits as traditional Medicare for 91% of or 85% of or even less a percentage of what the government spends now (or would otherwise spend then).
Like I said about a month ago, with friends like his, Ryan doesn't need enemies.
-- Dennis Byron
