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The Possible Future Of Health Care, Given VP Pick


So what makes Paul Ryan such a bold pick and potentially such a risky one is the detailed budget plan he has now twice passed through the GOP-controlled House. That plan has not passed the Senate, and President Obama says if it reached his desk, he'd veto it. The heart of Ryan's plan calls for dramatic changes to the nation's largest government health programs, Medicare and Medicaid.

With us now to discuss what those changes could mean for the campaign and the country should Romney and Ryan win the race is NPR's Julie Rovner. Julie, hello.


RAZ: Let's start with what Ryan's plan would do. How would Medicare change if Ryan's plan were to become law?

ROVNER: Well, one reason Medicare costs are growing is because there's no limit on how much Medicare will pay overall for health care. Basically, the more health care seniors consume, the more Medicare, meaning us taxpayers, pay. Now, under Ryan's plan, that would change. Starting 10 years from now, it would give people on Medicare a set amount of money every year they could use to buy a private insurance plan. And that amount would rise every year, but by less than the amount of medical inflation. So the idea is that insurance companies would find ways to cut costs so people could still maintain the same level of benefits.

But there's no guarantee that it wouldn't just end up shifting costs from the government to the beneficiaries themselves. So it basically puts the risk of future health care inflation on patients rather than Medicare, which may be good for the federal government's bottom line, but may not be so good for the people who depend on the program, or at least that's what critics of the plan say.

RAZ: This is so-called voucher plan.

ROVNER: That's right.

RAZ: OK. That's Medicare. What about Medicaid?

ROVNER: Well, Medicaid, for those who have trouble keeping them straight, is the program that serves about 60 million low income, mostly women, children, people with disabilities and elderly people who need long-term care services, like in nursing homes. And its costs are shared between the states and the federal government, unlike Medicare, which is a solely federal program. States have been complaining for years that Medicaid consumes more money than any other item in their budget, yet the federal government dictates to them, in most cases, who and what they have to cover.

Now, one thing Medicare and Medicaid have in common is that they're unlimited as long as care is delivered, the federal government pays its share. Under the Ryan budget, that would change for Medicaid just in a different way. The idea is to give states a set amount of money called a block grant, but give them much more freedom to decide how to use that money, fewer stings, if you will. But it would reduce spending for Medicaid pretty dramatically by about a third over the next decade, according to the Congressional Budget Office.

Now, even if states could find efficiencies, no one thinks they could make up that much money without raising taxes, cutting benefits or cutting eligibility.

RAZ: OK. We've obviously heard a lot more about Medicare than Medicaid. Why is that?

ROVNER: Well, there's a very simple reason: older people vote. And in recent elections, older people have been more of a swing voting bloc, particularly in important battleground states like Florida and Iowa. Now, Paul Ryan's Medicare changes aren't supposed to affect anyone under the age of 55, so people who are on Medicare now, in theory, shouldn't be affected. But that's not likely to stop Democrats from using the plan as a huge line of attack with seniors.

RAZ: With seniors, right.

ROVNER: Right. In 2010, Republicans managed to win some senior votes by accusing Democrats of cutting Medicare as part of that year's big health overhaul. Democrats have been planning to use Congressman Ryan's budget as a way to fight back. And for them, having Governor Romney actually put right on the ticket just makes that job that much easier.

But one thing it also does, I think both sides agree, is make this campaign about something a lot more substantive than some of the stuff the candidates have been arguing about. Voters are now going to have two very different visions of what the role of government in health care should be.

RAZ: And, Julie, just as an aside, Paul Ryan has been critical of Mitt Romney's health care plan for Massachusetts in the past, right?

ROVNER: Yes, he has because like the federal health plan that President Obama passed, it would require most people to either have health insurance or pay a fine. But pretty much every conservative Republican has been critical of it. There's pretty much nobody that Romney could have chosen who hasn't been critical.

RAZ: That's NPR's Julie Rovner. Julie, thanks.

ROVNER: You're welcome. Transcript provided by NPR, Copyright NPR.