Peter Orszag vs. Paul Ryan: Part Deux

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Daily Caller:


Peter Orszag versus Paul Ryan: Part Deux
By Jon Ward - The Daily Caller | Published: 1:32 AM 07/29/2010


White House budget director Peter Orszag has gone after Rep. Paul Ryan’s “Road Map” plan before, critiquing the Wisconsin Republican’s vision for solving America’s entitlement and debt crisis earlier this year, when releasing President Obama’s budget.

On Wednesday, Orszag used the enlarged platform bestowed upon him in his last speech as a White House adviser to go after Ryan again, this time in more detail than ever before. As before, it was civil, but Orszag went to considerable lengths to argue that Ryan’s plan would not work.

Orszag’s criticism comes just days after Ryan himself delivered back to back speeches in Washington touting his plan. Ryan’s remarks at the Brookings Institution, a center-left think tank, drew attention when he called out his own party along with Democrats for letting political concerns crimp serious discussion of how to fix the nation’s debt and deficits.

The decision to so publicly elevate and critique Ryan shows both the seriousness with which Obama and his top advisers take Ryan’s alternative vision for the country’s future, as well as the vehemence with which they disagree. Orszag’s push against the “Road Map” came on the same day that the Democratic National Committee attacked the plan in a preview of their midterm election strategy.

Ryan blasted Democrats for their response to his plan.

“It is unfortunate that the Democratic leadership’s only response to our nation’s fiscal cancer is to engage in tired political demagoguery against a sincere effort to tackle this challenge,” he said in a statement e-mailed late Wednesday to The Daily Caller.

Orszag spoke Wednesday from the same podium inside Brookings as Ryan did nearly a week ago, and made the case that the “Road Map” would not bring down health care costs, leaving seniors in Medicare with vouchers under Ryan’s plan that over time would cover less and less of their medical expenses.

Under Ryan’s plan, Orszag said, seniors would purchase “high deductible insurance plans, insurance plans in which they would pay out of pocket for regular medical expanses and insurance would only cover higher cost, catastrophic situations.”

“The logic goes that such plans would encourage seniors to shop among doctors and treatments and rationally economize on their health care spending. The core problem however, is that the bulk of health care spending is concentrated among those with serious illnesses and high health care costs,” he said. “For example, CBO found that in 2001, high cost Medicare beneficiaries – that is the top 25 percent of Medicare beneficiaries ranked by their costs – accounted for 85 percent of total Medicare spending. For such high cost patients, high deductible plans would do little to change the delivery of health care.”

Orszag continued: “Patients would rapidly run through their deductibles, and most of their costs are above those levels. Indeed, in the context of traditional health plans, [the Congressional Budget Office] concluded that even universal high deductible plans would reduce costs by only about 5 percent relative to conventionally designed PPOs, and not reduce costs at all relative to HMOs.”