White House blasts new Medicare overhaul proposal as "radical"

A Democratic senator and a Republican congressman today unveiled a new proposal to strengthen Medicare today, but the White House rebuffed the plan, arguing it would "end Medicare as we know it for millions of seniors."

White House Press Secretary Jay Carney said today that the Obama administration is concerned the new proposal "would undermine, rather than strengthen, Medicare. The Wyden-Ryan proposal could over time cause the traditional Medicare program to, quote, 'wither on the vine,' because it would raise premiums, forcing many seniors to leave traditional Medicare and join private plans, and it would shift costs from the government to seniors."

The new plan, put forward by Republican Rep. Paul Ryan of Wisconsin and Democratic Sen. Ron Wyden of Oregon, would give seniors the option of getting traditional Medicare (government-run health insurance) or purchasing private insurance. Seniors would receive a subsidy, called "premium support," to spend on either option. The plan would go into effect in 2022 and would keep the Medicare eligibility age at 65.

Earlier in the year, Ryan put forward a more conservative idea that would entirely phased out government-run Medicare in favor of providing "premium support" vouchers for private insurance. The plan was endorsed by the Republican-controlled House, but it created an uproar among Democrats who charged that it would essentially gut the popular Medicare system.

Earlier in the year, Mr. Obama put forward a plan to save hundreds of billions from reducing overpayments in Medicare. Carney said today that reforming the program "would not require the kind of radical privatization or ending of Medicare as we know it that the Ryan proposal suggests and that the Wyden-Ryan plan gets you to eventually."

Some of the president's allies similarly argued that the Ryan-Wyden plan wouldn't help reduce health care costs but exacerbate the problem.

"Medicare, which is more cost-effective than private insurance, is not the problem, it is the solution to runaway health care costs," Richard Trumka, president of the union organization the AFL-CIO, said in a statement. "Under Ryan-Wyden, private for-profit insurance companies will cherry pick the healthiest seniors and stick Medicare with sicker and more costly seniors, driving up costs for Medicare, fragmenting and destabilizing the Medicare risk pool... In the end, the answer to the problem of health care cost growth is for more people to use Medicare, not fewer."

Wyden said today that his plan would "offer a menu of private sector choices" along with traditional Medicare so that "they hold each other accountable."

House Speaker John Boehner commended the idea as "worthy of our consideration" and "a step in the right direction."

After coming under fire earlier in the year for slamming Ryan's original Medicare reform plan, GOP presidential candidate Newt Gingrich praised the Ryan-Wyden today as a "major breakthrough."

The new plan takes some heat off of Republicans, who were put in a tough political position by Ryan's original, more controversial plan.