The president also doubts the role of insurance companies in Ryan's plan. Ryan's plan encourages competition among insurers, which would supply the same basic health-care coverage set by a government panel. The insurance companies would be regulated, earn modest profits, and be insulated from congressional meddling when the public starts lobbying for more medical services than the country can afford.
Today's system also features insurance companies, albeit a single one called Medicare. The president wants to keep our single insurance company and get it to simply reject bills that are too high. Ryan's plan scores more points here as well.
Not Far Apart
Given that Obama's and Ryan's plans aren't that far apart, what can be done to make a marriage?
They need to agree first on the share of GDP to be spent on Medicare each year, and then to find an efficient, progressive and foolproof way to make those and only those expenditures. I think Ryan should give on the Medicare-to-GDP spending share and Obama should go for Ryan's mechanism, which, incidentally, is the same one used in the president's health-exchange system.
Getting these grownups to play nice may be impossible, especially after Obama criticized the Ryan plan because it relies on "privatization" and "vouchers," as if that's a dirty word.
In fact, the current Medicare system provides a voucher in the form of a Medicare card entitling one to health care subsidized by the government. Ryan's plan doesn't actually use the V word, but it too provides a right for participants to buy health care subsidized by the government.
The big difference is that the current system's voucher is open-ended, whereas Ryan's is capped. But the president wants to have his panel fix what his voucher will cover and pay. So it too is capped. As for privatization, both the current system and Ryan's plan rely on private companies to provide health care.
Gingrich's Jump
To make matters murkier, presidential candidate Newt Gingrich has jumped into the fray, calling the current system "left-wing social engineering" and Ryan's plan "right-wing social engineering." I guess a Democratic open-ended voucher that would be limited by a panel in what it can buy is left wing, and a Republican voucher that pays for a fixed set of basic health-care services is right wing. Glad Gingrich sorted out the essence of our political differences.
But Gingrich did let slip one thing that made sense. In the process of castigating social engineering, he endorsed it by saying that people must be forced to buy or simply be given health insurance so they don't free-ride on society.