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The disabled may be hurt most by Paul Ryan's Medicare plan

Medicare plan by Paul Ryan, the GOP vice presidential candidate, would result in a greater share of costs shifting to the elderly and the disabled, critics say.

August 21, 2012|David Lazarus
  • Republican vice presidential candidate Rep. Paul D. Ryan (R-Wis.) speaks during a campaign rally in Manchester, N.H. Under his plan, set-cost vouchers would be used to buy health insurance. But the voucher would likely fall short of the amount needed for the equivalent of full Medicare coverage.
Republican vice presidential candidate Rep. Paul D. Ryan (R-Wis.) speaks… (Evan Vucci, Associated…)

Amid all the chatter about whether Paul D. Ryan's proposed changes would, as Democrats say, "end Medicare as we know it," one group has been largely overlooked: disabled people.

The vast majority of Medicare's roughly 48 million beneficiaries are seniors over the age of 65. But about 8 million are disabled people of all ages. The federal program was expanded in 1972 to include those with permanent disabilities.

Many seniors are rightly concerned that Ryan, the conservative congressman tapped by Mitt Romney as his vice presidential running mate, has proposed a plan that could result in higher out-of-pocket expenses for Medicare coverage.

But disabled people could be in for an even bigger shock.

"People with disabilities are among the most vulnerable of the Medicare population," said Tricia Neuman, senior vice president of the nonprofit, nonpartisan Kaiser Family Foundation. "They have chronic conditions that require ongoing care, and, in many cases, they have relatively low incomes."

In other words, Ryan's plan could entail higher healthcare costs for people in the worst position to deal with them.

A quick refresher: I wrote last week about how the Ryan plan would affect Medicare and Medicaid. People under 55 would receive a federal subsidy — a voucher — to buy health insurance once they reach the eligibility age, which Ryan would raise to 67.

That voucher would be used to buy either conventional Medicare coverage or a similar plan from, say, one of half a dozen private insurers.

The amount of the voucher would be determined by the cost of the second-least-expensive plan available, which experts say would likely be private coverage that would not be as comprehensive as Medicare.

People who select a plan that's cheaper than the subsidy would be free to pocket the difference. Those who prefer coverage that's pricier than the subsidy — Medicare, for example — would have to pay the additional cost themselves.

The upshot, critics say, is that Ryan's plan would result in a greater share of Medicare's costs shifting to the elderly and the disabled.

Spencer Shiffman has been on Medicare since he was diagnosed with testicular cancer at the age of 24. The Calabasas resident beat it — and overcame a recurrence four years later.

Then at age 33 came an even more punishing blow: a diagnosis of peritoneal mesothelioma, a particularly aggressive form of cancer that the National Institutes of Health describes as "a universally fatal disease" that typically kills within one year.

"Without Medicare, I'd have been dead years ago," Shiffman, now 51, told me.

He credited the government program with covering the various forms of treatment — chemotherapy, surgery, blood transfusions — that have allowed him to beat the odds and live a relatively normal life, despite his ongoing designation as a terminal cancer patient.

So what would happen to Shiffman under Ryan's overhaul of Medicare? Like other beneficiaries, he'd receive his annual subsidy from the federal government. Unlike many others, he wouldn't have much choice in coverage.

"I see a number of different specialists and will have to monitor my condition for the rest of my life," Shiffman said. "So I'd probably have to stick with Medicare, whatever the cost," because it would provide the most coverage.

That cost would almost certainly be higher for Shiffman and others in his position, said David Lipschutz, policy attorney with the nonprofit Center for Medicare Advocacy.

A big concern, he said, is private insurers trying to woo healthier people with lower-priced plans that offer less coverage than Medicare.

"Medicare would retain the folks who are sicker and cost more," Lipschutz said. "That would drive up the cost of the program."

He also warned of significant consequences for so-called dual-eligibles — people who qualify for both Medicare and Medicaid because of age or condition as well as income level.

According to some estimates, the Ryan plan would cut Medicaid federal spending for low-income people by about a third over the first decade. Healthcare analysts expect many people to be dropped from the program as funding dwindles.

Joel Rosenberg, 72, is a dual-eligible. He told me Medicare covers much of the cost of treating the prostate cancer he was diagnosed with in 2010, but Medi-Cal — as Medicaid is known in California — is essential for lowering the costs of his prescription drugs.

To help cover his medical costs, Rosenberg has had to take out a reverse mortgage on his Highland Park house. One day, ownership of the property will revert to the bank.

"I have no other income," Rosenberg said. "If I lost Medi-Cal, it would be very difficult. Very difficult."

What's the solution? I suggested it last week, but I'll make it more explicit here: Medicare for all.

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