Having secured “draconian” cuts in a last-minute budget deal last week, House Republicans are hyping House Budget Chairman Paul Ryan’s (R-WI) new “Path to Prosperity” plan. The proposal professes to reform programs like Medicare and Medicaid to rein in spending by $6.2 trillion over the next decade. But as the Washington Post’s Ezra Klein notes, Ryan’s Medicare and Medicaid plans “rely on the same bait-and-switch: They use a reform to disguise a cut.” By making Medicare a voucher program and Medicaid a block grant program with $750 billion less in funding, Ryan’s plan forces seniors to pay more for the same benefits, according to the non-partisan Congressional Budget Office, and jeopardizes vital health care services for millions of low-income Americans.
Today on Fox News Sunday, host Chris Wallace questioned House Majority Leader Eric Cantor’s (R-VA) support for a plan in which Americans “pay more out of pocket.” Defending the proposal, Cantor argued that these programs sometimes provide a “safety net” for “people who frankly don’t need one” and that the shift of the burden from the government to the beneficiary will teach government “to do more with less”:
CANTOR: We are in a situation where we have a safety net in place in this country for people who frankly don’t need one. We have to focus on making sure we have a safety net for those who need it.
WALLACE: The Medicaid people — you’re going to cut that by $750 billion.
CANTOR: The medicaid reductions are off the baseline. so what we’re saying is allow states to have the flexibility to deal with their populations, their indigent populations and the healthcare needs the way they know how to deal with them. Not to impose some mandate from a bureaucrat in washington.
WALLACE: But you are giving them less money to do it.
CANTOR: In terms of the baseline, that is correct…What we’re saying is there is so much imposition of a mandate that doesn’t relate to the actual quality of care. We believe if you put in place the mechanism that allow for personal choice as far as Medicare is concerned, as well as the programs in Medicaid, that we can actually get to a better resolve and do what most Americans are learning how to do, which is to do more with less.
In reality, the Medicaid cuts will actually force states to do less with less. As the Wonk Room’s Igor Volsky points out, Ryan’s block grant idea would actually “destroy Medicaid” because the annual federal appropriation would be less than projected growth. States would thus make up the difference “by increasing spending or (more realistically) capping enrollment, cutting eligibility, limiting mandatory benefits and lowering provider reimbursements.” Numerous GOP governors are already itching to do so. And for Medicare beneficiaries, not only would low-income seniors end up paying more for the same benefits, but health insurers “will likely cherry-pick the healthiest enrollees” thereby increasing the costs for sicker individuals.
The Ryan plan does, however, provide a “safety net” for one specific demographic. Ryan’s plan will reduce the top marginal income tax rate and the corporate income tax rate from 35 percent to 25 percent — a move that, as the Wonk Room’s Pat Garofalo notes, shifts the tax burden down the income scale onto the middle class. Given these priorities, it appears that, for Cantor, those in need of a safety net are America’s wealthy.