A CBO analysis of the proposal unveiled by House Budget Committee Chairman Paul Ryan (R-Wis.) looked at what would happen as seniors moved from Medicare to private coverage under the plan.
The CBO concluded that due to efficiencies of scale, private coverage is likely to be more expensive than insurance run by the government.
And because seniors would be paying part of the premium out-of-pocket, private insurers would be under pressure to keep costs in check. The CBO said private payors would have cost-reduction tools that Medicare does not use, such as limiting benefits, changing co-payment amounts, managing how patients use services and controlling access to physicians and hospitals.
The CBO added that the change would reduce the use of “new, costly but possibly beneficial technologies and techniques.”
Read the NPR report on the CBO analysis of the GOP’s proposed budget.
Read more coverage of House Republicans’ proposal to shift Medicare enrollees to private payors:
– Hospital Groups Slam GOP Budget Plan, Especially Medicaid Cuts
– GOP Proposal Would Fundamentally Change Medicare, Medicaid
