March 21, 2012

Competing Medicare Plans Would Be a Step in the Right Direction

Summary

The chief virtue of the Wyden-Ryan plan is that it harnesses the enormous shopping ability of Americans to find good value for the money; in so doing, it avoids politicizing what should be private medical decisions about the scope of their health care coverage.

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The chief virtue of the Wyden-Ryan plan is that it harnesses the enormous shopping ability of Americans to find good value for the money; in so doing, it avoids politicizing what should be private medical decisions about the scope of their health care coverage.

While not perfect, the Wyden-Ryan plan is a vast improvement over the Affordable Care Act when it comes to reigning in the exploding cost of health care entitlements without creating enormous problems of access to care or other unintended consequences.

By trusting individuals to figure out how to get good value for the money from private Medicare plans, the Wyden-Ryan plan’s reliance on competition and choice offers far more promise than the Affordable Care Act of finding the right level of health spending for seniors.

The bottoms-up approach of letting individuals choose among competing Medicare plans is far more promising than the Affordable Care Act’s top down approach of using experts and heavy regulation to steer the Medicare program in the right direction.

Just as competition and choice in Medicare Part D have resulted in premiums 40 percent lower than anticipated, I have far more confidence in the ability of a market-oriented plan such as Wyden-Ryan to constrain Medicare spending than in the misguided top-down approach embedded in the Affordable Care Act.