Proposals to turn Medicare into a voucher system would take health care in precisely the wrong direction — pushing up costs for current and future retirees, and eroding protections that Americans have earned through many years of hard work and taxes.
Yet, in a short-sighted attempt to save money, vouchers are being promoted on Capitol Hill as an answer to rising costs.
Unfortunately, they are the wrong answer. Vouchers pose troubling risks for1.3 million New Jersey residents who are currently in Medicare, not to mention nearly 1.9 million more age 50 and older who will enter the program in the next 15 years.
Fortunately, President Donald Trump has promised to protect Medicare and Social Security, at one point telling older voters: “I am going to protect and save your Social Security and your Medicare. You made a deal a long time ago.”
Congress needs to follow the president’s lead. Vouchers would break a basic promise of Medicare, which is to provide a guaranteed benefit package. Under a voucher system, sometimes known as premium support, the basic promise could be tossed aside. Instead, consumers would get a fixed dollar amount to help pay for care in the private marketplace.
And if that amount turns out to be insufficient, tough luck. Seniors and future retirees could have to pay thousands of dollars out of their own pockets at a time when they can least afford it.
In our own state of New Jersey, residents in poor health would quickly feel the pain of a voucher system. That includes the 30 percent percent that have two or three chronic health conditions and rely on care they can afford. Many with limited resources could end up in health plans that limit their choice of doctors and demand high out-of-pocket spending to get needed care.
Nationally, one in four Medicare beneficiaries has incomes below $14,350, and one in two has incomes below $24,150. Raising their health care costs could be disastrous, forcing many to choose between going to the doctor and paying for other necessities.
The risks posed by a voucher proposal go against President Trump’s commitment to protect Medicare. Older voters helped decide the election and they’re counting on Congress to abandon this proposal.
The risks are widely recognized. For example, studies by the Congressional Budget Office and Medicare Payment Advisory Commission suggest that moving to vouchers could hit most Medicare beneficiaries in the pocketbook.
Yes, Medicare needs to be strengthened for future generations, but shifting costs to seniors and workers who’ve paid into the system their entire working lives is the wrong approach. We can put Medicare on stable ground with common-sense solutions, such as clamping down on drug companies' high prices, improving coordination of care and use of technology, and cutting out overtesting, waste and fraud.
For example, the average cost for a year's supply of a prescription drug more than doubled since 2006, to over $11,000 in 2013. That's about three-fourths of the average Social Security retirement benefit, or almost half the median income of people on Medicare. Multiply this by the two to four drugs that many seniors take, and you see the magnitude of the problem.
AARP is committed to working with elected officials of both parties to ensure that Medicare remains financially stable. But solutions must be responsible. On behalf of our 1.3 million members in New Jersey and 38 million throughout the nation, AARP will continue to champion a Medicare system that delivers on the deal Americans have counted on and deserve.
If you share our opposition to vouchers for Medicare, please contact your members of Congress to make sure your voice is heard.
Dave Mollen is the state president for AARP New Jersey.