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Home Publications Blogs Beat the Press The Debate Over Privatizing Medicare: Can Anyone Say $20.5 Trillion?

The Debate Over Privatizing Medicare: Can Anyone Say $20.5 Trillion?

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Tuesday, 12 April 2011 04:27

The NYT has a front page story on the debate over Representative Ryan's plan to privatize Medicare. The article is entirely in the form of he said/she said, providing readers with absolutely no information that would allow them to assess the arguments over the plan. This is especially important since the article reports that changes like those in the Ryan plan are necessary to control costs.

The assessment from the non-partisan Congressional Budget Office (CBO) is that the Ryan plan raises, not lowers, the cost of insurance. The CBO assessment implies that the Ryan plan would raise the cost to the country of buying Medicare equivalent policies by $20.5 trillion over the next 75 years (Medicare's planning period). This amount is almost four times as large as the projected Social Security shortfall. It comes to more than $60,000 for every man, woman, and child in the country. While this extra cost would not be borne by the government under the Ryan plan, it implies an enormous burden on future generations of retirees who may have to spend more than half of their income on health care.

Comments (2)Add Comment
Ayn Rand Demotes Paul Ryan to Assistant Broom Sweeper
written by izzatzo, April 12, 2011 8:32
As Paul Krugman wrote, the Ryan plan is not a radical solution. It's a fraud.

Paul Ryan is not against the nanny state. Ryan endorses the nanny state that made the rich rich by creating monopolies and suppressing competition.

The only nanny state Ryan is against is the one that attempts to introduce competition into the private monopoly markets he was instrumental in creating.

Ryan's reform plan for health care is equivalent to turning over the interstate highway system to a private monopolist then handing out vouchers to the public for 'choices' among toll road prices that double and triple the cost of driving.

Even Ayn Rand knew who your nanny was and would have supported Baker in that regard. She would have demoted Paul Ryan to Assistant Broom Sweeper based on his marginal revenue product and affinity for socialist rent seeking.
Trends in privatization
written by Scott Dunn, April 13, 2011 6:47
Dean, I was searching for your article, "Why not globalize healthcare?" and along with that, I found this:

http://rwer.wordpress.com/2010/10/21/globalizing-healthcare-a-prescription-with-side-effects/

The most interesting point of that article is the author's observation that of all the OECD countries, the US has the most highly privatized healthcare system in the world (with one exception: Greece.)

If Mr. Ryan really believes that privatizing healthcare is the path to prosperity, he might want to check out the trends.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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