Ryan’s proposal is a dangerous prescription
Lost in the passionate debate on President Obama’s health care reform initiative is that Congressman Paul Ryan has introduced his own plan.
Unfortunately, Ryan’s plan (H.R. 2520) will make the health care crisis even worse by shifting more power away from patients and to the health insurance industry. Ryan would give insurance companies even more latitude to discriminate based on age, gender and preexisting conditions, and to profit from selling policies with gaping holes that leave consumers vulnerable to claim and treatment denials.
The first feature of Ryan’s plan is to tax health insurance benefits. This is a radical departure from the policy of the United States since World War II of using the tax code to encourage employers to provide health insurance to their workers. The Center on Budget and Policy Priorities concludes that millions of American will lose their health insurance at work if benefits are taxed, and the Economic Policy Institute estimates that 415,000 Wisconsinites would lose their coverage.
Ryan’s plan also provides tax credits of $2,290 for individuals and $5,710 for families to help them buy insurance on their own. These amounts are grossly inadequate, as the average cost for group health insurance in Wisconsin is now $13,559 for family coverage and $4,916 for individual coverage.
By forcing millions of people who now get their health insurance at work to buy it on their own, Ryan gives the insurance industry greater power to skim off the most profitable individuals, and to charge discriminatory rates to everyone else for barebones policies that expose them to potentially bankrupting costs and treatment denials.
Ryan asserts that his plan will limit insurance industry abuses. Unfortunately, the regulations Ryan suggests are left to the voluntary actions of each state. Even worse, Ryan’s plan actually prohibits limitations on premiums, co-pays, deductibles and out-of-pocket expenses. Insurance companies will be free to price anyone out of the market that they consider a bad risk. Ryan proposes no meaningful coverage standards, so insurance companies can continue to sell policies with dangerous coverage gaps.
Ryan’s health care plan also eliminates Medicaid coverage for low-income seniors and forces low-income families currently on Medicaid to go out and buy health insurance on the private insurance market.
The whole thrust of Ryan’s plan is to give the health insurance industry more power to decide how much to charge, what medical services will be covered, and what co-pays, deductibles and benefit caps will apply to each individual or family. The deciding factor in all of these decisions will be profits, not the health care needs of most Americans.
It is no surprise that, according to the Center for Responsive Politics, Ryan’s largest political contributor is the health insurance industry, which has given him $493,000. It is fair to ask: is Paul Ryan representing the people of southern Wisconsin or the health insurance industry?
Robert Kraig is program director for Citizen Action of Wisconsin, a grassroots organization with 90,000 members that advocates for health care reform. Address: 221 S. 2nd St. Suite 400, Milwaukee, WI 53204; phone (414) 476-4550; e-mail firstname.lastname@example.org.