ADEA Washington Update

Proposals to Overhaul Medicare, Medigap Could Resurface in Budget Talks

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To end the recent budget stalemate, Rep. Paul Ryan (R-WI) offered a series of proposals to overhaul Medicare and other programs. His proposals did not make it into the final agreement, but the Wisconsin Republican’s ideas are likely to provide a framework for what House Republicans seek in future budget negotiations.

In an October 8, 2013, Wall Street Journal op-ed column, the chairman of the House Budget Committee called for combining Medicare Parts A (hospital insurance) and B (medical insurance) to make the program “less confusing” for senior citizens. He also called for imposing higher Medicare premiums on wealthy recipients, streamlining Medigap plans to reduce costs and make them more efficient, and asking federal employees to contribute more money toward their retirement.

Although Democrats have emphatically rejected his House-passed budget blueprint, Ryan stressed that President Obama has indicated his willingness to discuss Ryan’s proposed changes to Medicare and Medigap in past negotiations.

“These ideas have the support of nonpartisan groups like the Bipartisan Policy Center and the Committee for a Responsible Federal Budget, and they would strengthen these critical programs,” the congressman wrote. “And all of them would help pay down the debt.”

Ryan, the Republicans’ 2012 vice-presidential nominee, is considered his party’s intellectual leader in the House and commands wide respect among fellow Republicans. He broke with House GOP leaders to oppose the budget deal signed into law on October 16, 2013, which The Washington Post said earned him credibility with the Tea Party-backed lawmakers whose demands to delay the Affordable Care Act (ACA) forced the shutdown.

Along with Sen. Patty Murray (D-WA), Ryan will co-chair the House-Senate conference committee on fashioning a budget agreement, which was formed as part of the deal to reopen the government. Murray and other Democrats are adamantly opposed to continuing the drastically lower levels of mandatory spending cuts as part of sequestration, and Ryan agreed in his op-ed column saying, “The truth is, there’s a better way to cut spending.”

As a result, Ryan is likely to propose offsetting cuts in entitlement programs as a possible alternative. He is also likely to begin to tackle overhauling the tax code, something that House Ways and Means Committee Chairman Dave Camp (R-MI) and Senate Finance Committee Chairman Max Baucus (D-MT) have been discussing for more than a year.
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