Path to Prosperity quite the opposite

A key part of Paul Ryan’s 2012 budget, which he calls a “Path to Prosperity,” is dismantling Medicare while at the same time repealing the Patient Protection and Affordable Care Act.

Ryan’s Path would provide vouchers that participants would use to purchase private health insurance. I assume the cost of the vouchers would be paid for through payroll deductions and the program would be administered by a government agency. This sounds like Medicare, so where do the savings come from?

Ryan believes that private health insurers can deliver services much cheaper than Medicare does. This is simply not the case. Administrative costs for Medicare stand at less than 5 percent of claims and Medicare has the bargaining power of the government to negotiate lower costs for health services.

Private insurers do not have the same leverage to negotiate with health care providers, and administrative costs are somewhere around 20 percent and rising.

PPACA has provisions for limiting administrative costs, but Ryan’s Path would remove those limitations. Private administrative costs are high, in part, because private insurers pay for advertising and pay profits to shareholders.

If we follow Ryan’s Path we can each expect to pay much more for health care for which we will receive much less. We can also expect our taxes to pay for advertising and shareholder profits.

Ryan’s Path also would slash the top tax bracket from 39.6 percent to 25 percent. Ryan believes that it is a good idea to reduce assistance to our senior citizens, who need our help the most, and reward those who need our help the least. The details of his plan make it clear that this is a path to prosperity only for those who are young and already prosperous.

John Ritchie

Geneva