Get 40% Off
👀 👁 🧿 All eyes on Biogen, up +4,56% after posting earnings. Our AI picked it in March 2024.
Which stocks will surge next?
Unlock AI-picked Stocks

Paul Ryan's bid to overhaul Medicare to resurface in new Congress

Published 12/12/2014, 04:56 PM
Updated 12/12/2014, 05:00 PM
Paul Ryan's bid to overhaul Medicare to resurface in new Congress

By David Lawder

WASHINGTON (Reuters) - The next Republican budget will look a lot like those written by exiting House Budget Committee chairman Paul Ryan, eliminating deficits in 10 years and calling again for a massive revamp of the federal Medicare program, Ryan's replacement said on Friday.

Representative Tom Price, who takes the reins of the U.S. House budget panel in January, told reporters he will "build on" Ryan's proposals by devising ways to put more federal benefits programs under the control of states.

Ryan will take over as chairman of the tax-writing House Ways and Means Committee. Over the past four years, he used his budgets to articulate a vision for Republican priorities that elevated him to the national political stage, even though none were passed by the Democratic-controlled Senate.

Ryan's budget last year sought deep cuts to social safety net programs in order to achieve balance by the mid 2020s.

Price, a physician with four years on the Budget Committee, said a Republican-controlled Congress can now advance policies pioneered by Ryan, including his controversial Medicare plans.

Those plans would scale back the popular social insurance program for the elderly and disabled by limiting beneficiaries to a set amount of money every year to buy private healthcare insurance.

Known as "premium support," the program as envisioned by Ryan would mark a dramatic shift from the current Medicare system, under which the federal government helps pay for all medical services that an individual uses.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

"The issue of premium support, internally is now basically settled policy for the Republican conference," Price said.

Republicans argue that this will save Medicare from collapsing as the massive Baby Boom generation retires, but Democrats and President Barack Obama say it would "gut" the program and shift a growing healthcare cost burden to seniors.

One potential way for Republicans to push through such a policy would be to employ a procedural tool that allows certain budget-related bills.

Known as "reconciliation," the maneuver was last used by Democrats in 2010 when they controlled both House and Senate, to pass Obamacare, President Barack Obama's landmark healthcare reform law.

Reconciliation can only be used in limited cases. Some Republicans say it should be employed to repeal Obamacare. But Price said his party needs to think hard about whether this might be a wasted effort, because Obama would be certain to veto such legislation.

"There aren't many opportunities to do a reconciliation piece of legislation, so we want to use it in the wisest manner possible," he said.

Republicans will soon decide whether they would be better off using reconciliation to pass reforms to federal benefits or tax reform, which Obama may be more likely to sign, Price said.

A March 2015 deadline to extend the federal debt limit would present a "pinch-point" to demand more spending cuts, but Price said this did not have to lead to a debt default crisis.

(Reporting by David Lawder; Editing by Tom Brown)

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.