"Tomorrow's Medicare should give beneficiaries a generous defined contribution and allow them to choose between private plans and traditional Medicare. And lower-income future retirees should receive the most assistance. I believe that competition will improve Medicare and the coverage that seniors receive," Romney wrote in a USA Today op-ed published online late Thursday afternoon.
It was the only mention of Medicare in a longer op-ed by Romney about his plan for reducing government spending and debt, and the policy was only mentioned at the end of the piece. But it is new ground for Romney, who as late as last Friday gave no indication that he was considering such a move, when asked by a voter in New Hampshire.
A Romney adviser said the former Massachusetts governor held back details of his proposal last week to wait until he was ready to unveil it this week. Romney was set to discuss the proposal Thursday evening in New Hampshire and also plans to address it in a speech on Friday in Washington.
Rep. Ryan (R-Wis.), House Budget Committee chairman, is the foremost Republican leader on the issue of overhauling Medicare, Medicaid and Social Security. Ryan is at the vanguard of a movement within conservatism to reduce health care costs through price transparency and competition between health care providers. Liberals and progressives oppose the policy in favor of prioritizing and protecting the program as it currently exists. President Obama's health care overhaul included a range of changes to health care practices and would regulate health care prices under covered plans through an Independent Payment Advisory Board.
Whatever the means, if health care costs are not brought under control, the government's entitlement programs threaten to consume most of the federal budget. The three big entitlement programs are the main contributors to the mandatory spending portion of the budget, which already accounts for almost two-thirds of annual government spending.
Ryan met with Romney last week, and told the Weekly Standard that Romney "gets the situation, and I think he's serious about fixing it if elected."
"I think [Rick] Perry's the same way," Ryan added. "I know Herman [Cain]'s the same way."
Romney knows he is taking a political risk by embracing substantial changes to government benefits that go largely to the elderly and the poor. Some Democrats have accused Ryan of trying to destroy the programs, and will do the same with Romney. Ryan has fired back that his plan changes nothing for seniors currently in the program or soon to be enrolled, and that if nothing is done to make the programs solvent they will collapse under their own weight.
Reforms should not affect current seniors or those near retirement, and tax hikes should be off the table....
Tomorrow's Medicare should give beneficiaries a generous defined contribution and allow them to choose between private plans and traditional Medicare. And lower-income future retirees should receive the most assistance. I believe that competition will improve Medicare and the coverage that seniors receive.
Although this is only the broadest of outlines, it seems like Romney has something like the plan developed by Alice Rivlin and Pete Domenici of the Bipartisan Policy Center. See, for instance, this recent testimony by Rivlin:
Romney will have to offer more details about his plan before it can fully be evaluated, but at the very least it should be noted that an approach along these lines could yield significant Medicare savings, and would almost certainly improve the quality of Medicare.
There are at least two reasons why Paul Ryan's premium support model could prove to be a better choice. In terms of policy, Romney's Medicare reform might be easier for a Democratic president to reverse, because it would keep traditional Medicare in place. Politically, it's more feasible than the Ryan plan, but that could also prove to be a weakness: it's not a strong opening bid. All the same, the fact that Romney is sketching out a plan for reforming entitlements is probably one reason that Ryan is comfortable with the prospect of a Romney presidency.
All about: Washington, D.C., Los Angeles, Douglas Holtz-Eakin, John McCain, Mitt Romney, Paul Ryan
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