Medicare costs soar for seniors under GOP plan

(04-07) 04:00 PDT Washington - --

Seniors and people with disabilities would pay much more for Medicare under a new plan by Republicans in the House of Representatives that's designed to curb the nation's growing budget deficit, a Congressional Budget Office analysis shows.

For example, by 2030, typical 65-year-olds would be required to pay 68 percent of the cost of their coverage, which includes premiums, deductibles and other out-of-pocket costs, according to the CBO. They'd pay 25 percent under current law, the CBO said.

The GOP budget proposal also would raise the eligibility age for the popular program and repeal big chunks of the health care overhaul law that Congress approved last year.

House Budget Committee Chairman Paul Ryan, R-Wis., unveiled the fiscal 2012 budget proposal Tuesday.

Coming amid growing concern over the federal budget deficit, it's part of an overall GOP effort to reduce federal spending by at least $5 trillion over the coming decade.

Besides overhauling Medicare, Ryan's 10-year budget proposal would give states more control over Medicaid, the state-federal program for the poor, but it would cut the amount that states receive from federal coffers for that program by hundreds of billions of dollars over a decade.

Americans also wouldn't be required to buy health insurance, and employers wouldn't have to offer it. States wouldn't be on the hook to set up new insurance marketplaces as they are under the 2010 health care act, which Ryan would scrap.

The proposed changes drew criticism from Democrats and advocates for the elderly and the poor. Many zeroed in on the changes to Medicare. The Ryan proposal would do away with the traditional Medicare program and shift beneficiaries into private insurance plans in 2022 with federal subsidies under a model called "premium support."

Medicare enrollees would get a set amount from the government to buy private plans. Those plans would cost considerably more than traditional Medicare, the CBO said, partly because private plans pay hospitals, doctors and other providers more and have higher administrative costs. At the same time, enrollees would pay a higher percentage of the overall cost of their coverage.

Ryan's proposal, called "The Path to Prosperity," also would scrap the health care law's Medicaid expansion, repeal a voluntary long-term-care insurance program and cancel an advisory board the law created to recommend changes to Medicare spending.

Ryan appears to retain the health law's Medicare payment cuts to hospitals and Medicare Advantage plans.