Under the current system (and under Obamacare), the government sets the price (the reimbursement), and the absence of competition guarantees spiraling costs and/or rationing. Under Ryan-Wyden, a bidding process among insurance providers, including a federal insurance provider, would determine the government's premium-support payment to Medicare beneficiaries and would ensure that their out-of-pocket costs won't exceed those under the current system unless they choose a more expensive option. This bidding process -- competitive by definition -- would contain or reduce costs.
Recent studies have shown that such competition works. The Medicare Advantage program, which was far less ambitious than Ryan-Wyden, produced a 9 percent cost reduction. The savings under Ryan-Wyden should be substantially greater.
Team Obama has no plan of its own and no credible rebuttal for the Ryan-Wyden model, so they have begun a vigorous disinformation campaign to distort the Romney-endorsed plan.
They say his plan would end Medicare as we know it. To the contrary, it is the only plan on the table that has a chance of saving Medicare from insolvency. Those now 55 and older would receive Medicare benefits as they currently exist. As for all others, they would receive the same type of comprehensive coverage (though the costs of that coverage would be reduced through market forces), and the older, sicker and poorer would receive preferential treatment.
In fact, it is Obama, not the GOP, who has assaulted Medicare, robbing it of $716 billion to shore up Obamacare. Obama can't deny that he's pilfered this money from Medicare, but speciously argues that it is a cut to health care providers, not Medicare beneficiaries. But cuts to health care providers always result in a reduction to access. Indeed, Obama's own Medicare actuaries have warned that these cuts could result in providers discontinuing their participation in Medicare.
Obama also fraudulently claims that Ryan's original plan didn't put Obamacare's stolen $716 billion back into the Medicare fund, either. But Ryan's plan never took that money out in the first place because it involved a full repeal of Obamacare. Romney, for his part, clearly doesn't contemplate robbing the Medicare fund. Obama doesn't believe in market reforms and so has no ideas other than to impose top-down cost controls, which cannot work. His re-election guarantees the insolvency of Medicare -- and ultimately of the entire federal government.
The Romney-Ryan plan preserves benefits for current and future seniors and would drive costs down through competition, thereby shoring up Medicare's solvency and averting the principal driver of national insolvency. This is a debate Obama can't win on the merits, so expect increasing demagoguery, fear and stridency. But the truth will prevail.