Ryan would save the Medicare name, but the plan would change drastically.
- Medicare: Starting in 2022, the proposal would end the current Medicare program for all Americans born after 1956 and replace it with a new program (still called Medicare) which uses a voucher and would increase the age of eligibility for Medicare:[SUP][9][/SUP]
- Starting in 2022, the age of eligibility for Medicare would increase by two months per year until it reached 67 in 2033.
- After 2022, the current Medicare program ends for all people who have not already enrolled. People already enrolled in the current Medicare program prior to 2022 would continue to receive the program. New enrollees after 2022 would be entitled to a voucher to help them purchase private health insurance.
- Beneficiaries of the voucher payments would choose among competing private insurance plans operating in a newly established Medicare exchange. Plans would have to insure all eligible people who apply and would have to charge the same premiums for enrollees of the same age. The voucher payments would go directly from the government to the private insurance companies that people selected.
- The voucher payments would vary with the health status of the beneficiary. For the average 65-year-old, payment in 2022 is specified to be $8,000, which is approximately the same dollar amount as projected net federal spending per capita for 65-year-olds in traditional Medicare in that year.
- Each year, the voucher payments would increase to reflect increases in the consumer price index (average inflation) and the fact that enrollees in Medicare tend to be less healthy and require more costly health care as they age. They would not increase by the higher, healthcare inflation rate.
- The voucher payments to enrollees would also vary with the income of the beneficiary. The wealthiest 2% of enrollees would receive 30 percent of the premium support amount described above; the next 6% would receive 50 percent of the amount described above; and people in the remaining 92% the income distribution would receive the full premium support amount described above.
- Eligibility for the traditional Medicare program would not change for people who are age 55 or older by the end of 2011 or for people who receive Medicare benefits through the Disability Insurance program prior to 2022. People covered under traditional Medicare would, beginning in 2022, have the option of switching to the voucher system.
