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A Times Editorial

High stakes in entitlement reform

No state's future is tied tighter to Social Security, Medicare and Medicaid than Florida's. Eighteen percent of the Sunshine State's residents rely on Medicare. More than one in five Floridians receive Social Security benefits. More than 77,000 elderly residents are in nursing home care under Medicaid. Adjustments have to be made to these programs to extend their financial viability, and some of those changes are likely to be painful and unpopular. But Mitt Romney and Paul Ryan have failed to explain how their radical proposals to transform Medicare into a voucher program and Medicaid into block grants to the states would benefit Floridians.

Romney's Medicare proposal is essentially Ryan's with a big asterisk. Seniors in 2022 would receive a voucher to buy commercial health insurance or traditional Medicare. The voucher's value would rise over time, but not at the rate of medical inflation, requiring seniors to cover the difference. What that really means is affordable insurance for those 65 and older would no longer be guaranteed. Costs for individuals would go up and the quality of care would go down.

Romney would provide low-income seniors with more generous vouchers than those with higher incomes. And the Ryan plan calls for gradually raising the age at which seniors would qualify for Medicare to 67 in 2034. That may be necessary. But Romney's promised repeal of the Affordable Care Act also would leave seniors at the mercy of the private insurance market until Medicare kicks in. It would eliminate changes in the prescription drug benefit that have saved Florida Medicare recipients $274 million by gradually eliminating the "doughnut hole." Republicans quickly explain that everyone 55 and older now would remain on traditional Medicare, but they don't mention the impact of repealing health care reform.

Then there is the deceptive debate over $716 billion in cuts to projected spending for Medicare in the Affordable Care Act. Romney accuses Obama of reducing Medicare benefits, but those spending reductions are actually reduced insurance company subsidies, medical provider payments and other cost savings — lengthening Medicare's trust fund solvency by eight years. The Ryan budget includes the same amount of spending reductions, yet Romney says he does not support those cuts.

When it comes to Medicaid, Romney's proposal to give one set payment to each state would be great for Washington and bad for patients. Penny-pinching states such as Florida can be counted on to cut benefits and reduce access to health care for the poor rather than raise state revenues to meet the actual demand. That would throw more uncompensated care onto the backs of already struggling public hospitals and cause private insurance premiums to rise.

On Social Security, Romney would reduce the rate of growth of benefits for people with higher incomes and slowly raise the retirement age. These moderate suggestions stand in contrast to Ryan's previous push to partly privatize Social Security, a risky proposition that President George W. Bush could not sell and is still not viable. But Romney also should embrace extending payroll taxes beyond the first $110,000 of income, which could help restore the retirement program's long-term health.

There is plenty of room on these issues for leadership from both political parties, and Republican convention speakers this week keep touting the importance of bold ideas. It's one thing to be bold. It's another to recklessly promote untested ideological brainstorms that would jeopardize the health care of the elderly and the poor.

High stakes in entitlement reform 08/29/12 [Last modified: Wednesday, August 29, 2012 8:04pm]
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