Viewpoints: Ryan's budget plan would be beginning of end for Medicare

The House Republican budget is devastating to America's fragile recovery and to middle and working class families.

This is a budget that preserves billions of dollars in Big Oil subsidies while slashing education investments nearly in half, that gives the average millionaire an extra $150,000 windfall in tax giveaways while gutting nearly half of the federal government's commitment to Medicaid, and that makes it easier to ship jobs overseas while destroying over a million American jobs in transportation, research, health services and other vital sectors.

While the immediate pain in this budget is callously severe and counterproductive, the worst is yet to come. Let's not mince words: With time, this plan would end Medicare.

I served as California's insurance commissioner for eight years. To keep health insurance cost-effective and sustainable, you need a broad pool of enrollees. You need many more healthy people paying into the system than unhealthy people using services.

The great miracle of Medicare is just how cost-effective and popular it remains despite the fact that its primary patient pool – people 65 and older – are more likely to require frequent and costly medical services.

Indeed, over the last 30 years, per-consumer spending in Medicare has grown at a slower rate than private insurance.

Medicare is cost-effective through low administrative costs, a reliance on science-based medicine, and the purchasing power of the largest patient pool in America. Most doctors can't afford not to see Medicare patients, and it's in this power by numbers that one of the most at-risk pools of patients in America has held onto good affordable health coverage for more than four decades.

A year ago, Republicans in Congress voted repeatedly to end Medicare and replace it with an underfunded coupon system. After months of unrelenting criticism, they realized just how toxic this proposal was and ended their frontal assault on this popular and efficient program.

This year, House Republicans have wised up a bit and are pursuing the death of Medicare through more subtle means. They insist they're not eliminating Medicare this time around – just making it optional. They insist seniors can choose between using a capped coupon to purchase private insurance or stick with traditional Medicare.

What they won't tell you is that this plan will entice millions of healthy seniors to flock to private junk insurance plans, where slightly lower premiums will be offered at the expense of actual quality care when they get sick, and this plan will entice the wealthiest Americans to abandon Medicare and purchase gold-plated coverage. This will undermine most of the features of Medicare that make it an affordable option for American seniors:

1. The broad pool of patients will begin to evaporate.

2. The enrollees that remain will be less healthy on average.

3. The combined purchasing pool of the Medicare system will be markedly weakened, and more doctors will abandon Medicare.

4. The doctors who remain in Medicare will be overburdened, frustrating remaining Medicare patients and further incentivizing departures to for-profit plans.

5. Public support for Medicare will decline precipitously as fewer Americans are invested in the system, as the system becomes less cost-effective, and as fewer doctors accept Medicare.

Make no mistake, if this plan ever becomes law, it will mark Medicare's death by a thousand coupons. Seniors remaining with traditional Medicare will pay more as private insurers siphon off the healthiest and youngest among them. Seniors purchasing private insurance will also shoulder more of the cost of medical care as the value of their insurance coupon declines over time.

If the goal is to improve Medicare or make the system more cost-effective, there are plenty of options available to us that don't destroy it. We can let Medicare directly negotiate drug prices. We can encourage competition that would drive down the price of medications by letting Medicare import prescription drugs from Canada and other countries with high safety standards. We can continue electronic records modernization. We can expand efforts to crack down on Medicare fraud. And instead of increasing the age of Medicare eligibility to 67 like the House Republican budget calls for, we can lower the age of Medicare eligibility, bringing more healthy Americans into the system.

But let's talk brass tacks. Congressional Republicans aren't trying to improve Medicare. Because of an extreme ideology out of step with most Americans, they see Medicare as part of the problem. They're going to great lengths to end Medicare, and I hope they never succeed.

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