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GOP Tries Again on Medicare Overhaul

MedPageToday, 2012

WASHINGTON -- House Republican leaders introduced a budget proposal Tuesday that contained proposals for overhauling Medicare and Medicaid similar to those in .
"Real, specific reform is needed to strengthen the health and retirement security of seniors, and the economic security of all Americans," House Budget Committee Chairman Paul Ryan (R-Wis.) said in a posted Monday on his website.
But if those 55 and older won't see any changes in Medicare under the , those under 55, however, will be given a choice between traditional fee-for-service Medicare and several private insurance plans once they become eligible for coverage.
All of the private plans would be required to cover "at least the actuarial equivalent of the benefit package provided by fee-for-service Medicare," according to the proposal.
Once a beneficiary chooses a plan, the government would send that plan a "premium support" payment equal to either the cost of traditional Medicare or the second least-expensive private plan, whichever is less.
The arrangement is not technically considered a voucher program because the payment goes directly to the plan rather than to the beneficiary themselves.
Beneficiaries who chose a plan costing more than the amount of the premium support payment would have to make up the difference.
The proposal also would change the Medicaid program -- currently a joint federal/state program that guarantees a specific set of benefits -- into a block-grant program, in which states would receive a set amount of money to spend for Medicaid.
"States would no longer be shackled by federally determined program requirements and enrollment criteria," the proposal authors noted.
"Instead, they will have the freedom and flexibility to tailor Medicaid programs that fit the needs of their unique populations."
"The House budget once again fails the test of balance, fairness, and shared responsibility," White House Communications Director Dan Pfeiffer said in a statement.