Have Democrats Forgotten that Medicare Premium Support Was Their Idea?

“How queer everything is today! I wonder if I’ve been changed in the night? Let me think: was I the same when I got up this morning? I almost think I can remember feeling a little different. But if I’m not the same, the next question is, Who in the world am I? Ah, that’s a great puzzle…” – Alice, Alice in Wonderland

The above quote comes from one of the most famous scenes from Lewis Carroll’s Alice in Wonderland when Alice finds herself yo-yoing between different sizes, at times giant in need of getting out of a small door and at times tiny in need of reaching a large key, in hopes of chasing after the White Rabbit. Having gone back and forth from small to large one too many times Alice loses sight of who she is.

Having recently studied liberal’s history with premium support plans for Medicare I can see that Democrats are largely feeling the same confusion.

Following Rep. Paul Ryan’s introduction of the “Path to Prosperity” budget Democrats have taken aim at Ryan’s plan for Medicare reform. Ryan’s plan to save the ailing program uses a premium support model in which the government would make a defined contribution to beneficiaries who could then go out into the health care market and purchase care. The amount of the support would be determined by a competitive bidding process in which private plans send the government an estimate of the premiums they would charge for coverage at least equal to the Medicare package.

Democrats went ballistic at the idea.

Minority Leader Nancy Pelosi issued a statement saying that Ryan’s plan would “let Medicare wither on the vine.” Minority Whip Steny Hoyer said that “Republicans want to end the Medicare guarantee.” And numerous attack ads have gone up saying “Congressman Ryan voted to end Medicare” – parroting the same claim that was dubbed the “Lie of the Year 2011” by the nonpartisan PolitiFact.

Lost amidst the finger pointing and politicking by the numerous Democrats looking to score points with voters by twisting Ryan’s plan into something it’s not is the fact that premium support is a liberal idea. I don’t mean that in some theoretical sense. Premium support is a Medicare reform plan that was originated and crafted by some of the top liberal minds.

According to research done by Thomas Rice of UCLA and Katherine Desmond, the originator of the premium support idea was a Democrat by the name of Alain Enthoven. Enthoven, who was educated at Stanford, Oxford, and MIT (read: smart), was appointed by President Lyndon Johnson (of Great Society fame), received an award from John F. Kennedy, and served as a consultant to the Carter administration.

Being a Democrat hasn’t stopped Enthoven from continuing his support of a premium-support system for Medicare. “A better way to encourage accountable care is the “premium support” model proposed by House Budget Committee Chairman Paul Ryan,” Enthoven writes in a recent Wall Street Journal op-ed. “This is not ‘the end of Medicare,’ as some would have you believe.” Instead, he argues that it will “empower individuals” and “guarantee that Medicare can fulfill the promise of health security for America’s seniors.”

Another of the chief architects, and indeed the pair of economists who coined the term “premium support” were Henry Aaron and Robert Reischauer of the liberal Brookings Institute in 1995.

“Rather than paying for all services on a stipulated menu,” they wrote in their seminal article The Medicare Reform Debate: What is the Next Step, “Medicare would pay a defined sum towards the purchase of an insurance policy that provided a defined set of services.” Such a plan they argue would “encourage [individuals] to choose the plans whose style of care matches their preferences” while also “lend[ing] itself to budget control in ways that the current Medicare system does not.”

Aaron and Reischauer argue these changes are necessary because “budgetary and demographic developments mean that the program as it is now structured is unsustainable.” Sadly, things have only gotten worse in the fifteen years since the article was written.

Following up on the idea, the National Bipartisan Commission on the Future of Medicare, led by Democrat Senator John Breaux adopted the proposal. “This exercise has never been just about saving money – it has been about how to improve Medicare for beneficiaries, how to preserve Medicare as an entitlement…and how to give 1965 Medicare the upgrade it so desperately needs,” Breaux said in his opening statement of the Commission.

Given its liberal roots, Democrats should be celebrating Rep. Ryan’s plan for Medicare reform. But rather than focus on good policy, they’ve focused on the politics, and that means attacking anything that is considered a Republican idea. Better to not let Republicans get the credit than to save a program that is so fundamental for seniors.

Having twisted themselves in so many logical knots on the issue it would come as no surprise if Democrats, like Alice before them, is left asking themselves “Who in the world am I?” Because frankly, they are a party that very few Americans recognize anymore.