On June 22, the House Health Care Reform Task Force, led by House Speaker Paul Ryan, released their blueprint describing how the House Republican caucus’ hopes to reform our country’s health care system, entitled “A Better Way to Fix Health Care.” There is much in their approach that we at NCHC do not support.  To name just a few examples, there is nothing particularly appealing about proposals to repeal the entirety of the ACA, roll back federal support for Medicaid and CHIP, raise Medicare’s eligibility age or shutdown the Centers for Medicare and Medicaid Innovation’s crucial work on alternative payment models.  We’ll have more to say on these issues in later blog posts.

But there are ideas in the package that, properly developed, could improve our health care system. So we begin today by taking a close look at a few constructive proposals included in the report’s Medicare section.

We agree with the House Health Care Reform Task Force that while the Medicare program has successfully served America’s seniors and disabled for over 50 years, “the program faces notable challenges, including a complex financial structure and projected spending growth that make the program unsustainable for the long term.” These challenges may not be an immediate emergency—in part due to slower growth in Medicare spending per person since 2010.  But additional steps to get health care costs under control – in Medicare and across our health care system – remain crucial for the economic future of this country. There are recommendations in “A Better Way” that would move us closer to a better and more efficient Medicare program.

NCHC supports giving Medicare Advantage (MA) plans the flexibility to design benefits that are customized for the populations they serve – also known as value-based insurance design (VBID).  VBID would allow plans to tailor cost-sharing and supplemental benefits to specific population needs. For example, a plan that wanted to better serve beneficiaries with multiple chronic conditions could lower co-pays for care management and post-hospital care to encourage their use. Similar flexibility should be granted to certain alternative payment models under Original Medicare. Strong oversight and beneficiary protections need to be in place.  But on the whole, this is one approach to Medicare whose time has come.

“A Better Way” also proposes to create a pathway to compare quality in MA and fee-for-service (FFS). Ensuring that beneficiaries can make better-informed choices represents a constructive start toward bipartisan Medicare policy, provided that actual legislation really does level the playing field between MA and Original Medicare, rather than tilt it in one direction or another.

The House package goes on to urge combining Medicare Parts A and B – creating a single combined deductible, establishing an annual maximum out-of-pocket (OOP) cap, and aligning low-income protections with Medicare Part D.   Not only would the proposal seek to simplify and streamline Medicare, it would – again – create more parity between MA and FFS, as MA plans are already required to provide an OOP cap.

Of course, the details matter a great deal with any redesign of Medicare benefits. Similar proposals have floundered when combined with significant new restrictions on supplemental coverage (also included in the Republican proposal) or when savings were to be redirected to other purposes.  But if “A Better Way” is seen as an opening bid—not the final word—perhaps a redesign that actually improves Medicare for beneficiaries could be a topic for discussion in the next Congress.

To conclude, while there are many details to be ironed out in each of these areas, Speaker Ryan and his team deserve credit for some fresh ideas that have the potential to improve Medicare. We look forward to working with the Speaker and his colleagues in both parties to strengthen our health care system.