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Help me with my math?

This is a nonpartisan question — I appreciate the help — it seems the TV commentators either ignore me or cannot hear my question when the Medicare issue is discussed.

I am middle aged (35-54) and am trying to understand the Ryan Plan, although I took four college semesters of logical and critical thinking. This brings me to my dilemma: voucher or Medicare at retirement?

The federal government has a different rate for each state as far as monthly Medicare stipends: Oregon’s was about $800 while Florida was near $950 each month. My parents, age 70, can either just use the Medicare reimbursement schedule (many doctors complain it’s too low) and pay the deductible difference out of their savings, or they could join insurance companies like United Healthcare (favorite of AARP) or our hometown insurer Regence Blue Shield.

United offers a plan at no monthly premium to my parents that appears better than the straight Medicare. If you choose United, the federal government sends your monthly Medicare stipend directly to United Healthcare. My parents chose the Regence plan that has some dental and better prescription coverage but each pay an additional $135 per month along with the Medicare stipend (about $800) being directly sent to Regence.

Now for the Ryan question. Twenty years has passed and I am 65, it’s Medicare or voucher. The Medicare answer is easy; it is all the same options as the paragraph above. Today I am being told that the voucher alternative is going to save Medicare because by definition it will be better and cheaper for the federal government to send you the money/voucher and the insurance companies will compete for your business and the premium costs will be driven down.

OK, let’s keep it simple and say the monthly stipends to Oregon residents in 2032 is still $800 and now instead of choosing Medicare I say send me my $800 voucher. Hey, wait a minute, the cost of Medicare has not gone down; whether you send me or an insurance company the $800 it is still $800, no savings there. Ah the voucher, I chose that and I receive a stipend of $750 dollars, yes Medicare just realized a 6 percent savings (50 divided by 800) but now I need to find an insurance company who will give me a bit better coverage than Medicare or the AARP carrier for $50 less premium per month.

Does this sound logical to you that a private company would do such a thing? Well they would if you were in good health and they could cherry pick their customers. Let’s assume the Affordable Healthcare law is toast and there is no restriction on a carrier dropping you at any time. Then you are back in the Medicare pool and the government has all the high-cost retirees...Medicare still goes bankrupt and the insurance companies have record earnings. Please help me with my math!

Mike Taylor is a West Linn resident.



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