July 22, 2014

Rivlin Explains Medicare Reform Plan

  • The American health care system is a patchwork of public and private programs that serve citizens in different ways, depending on their age, military...

Alice Rivlin of the Brookings Institution focused on the importance of Medicare reform in testimony to both the Senate and House budget committees last week, suggesting that the program should shift to a "premium support" model beginning in 2018.

Under such a system, people could choose to stay in traditional Medicare although they might have to pay more, or they could enter a Medicare exchange with the voucher.

Rivlin, who served on President Obama’s fiscal commission and co-chaired the Bipartisan Policy Center’s Debt Reduction Task Force with former Sen. Pete Domenici, told the House committee that a premium support system -- in which beneficiaries could chose to participate -- would provide incentives for efficient delivery of services while controlling the rate of growth of Medicare costs. She also outlined a premium support plan she has drafted with committee chairman Paul Ryan (R-WI).

In the Senate testimony, Rivlin joined with Domenici to explain the premium support model and other entitlement reforms recommended by their task force. They stressed that the looming fiscal crisis offers an opportunity to make the government operate more fairly and efficiently.