Then & Now: Koch Attacks on Medicare


David Koch ran on a platform to cut payments to Medicare contractors in half.

Proposed A 50 Percent Reduction In Payments To Medicare Contractors

Clark: “We Propose A 50 Percent Reduction In Payments To [Medicare] Contractors For Processing Claims Payments.” In a white paper, Clark wrote, “Medicare Contractors – cut We propose a 50 percent reduction in payments to contractors for processing claims payments. We are confident that administrative overhead can easily be cut by that much.” [Clark For President White Paper On Taxing And Spending Reduction, 1980]

Proposed Policies To Cut Waste And Overhead In Medicare

Clark: “Tightening Up The Process At Medicare Would Benefit All Americans, Both As Taxpayers And Consumers.” In a white paper, Clark wrote, “Medicare – cut Waste, overhead, and excessive payments are rampant in the Medicare program. The program’s easy spending has helped to raise prices for all health care consumers, tightening up the process at Medicare would benefit all Americans, both as taxpayers and consumers.” [Clark For President White Paper On Taxing And Spending Reduction, 1980]


Koch-funded group backed plan to replace Medicare.

2011: AFP Backed FY 2012 Ryan Budget, Which Consolidated Income Tax Brackets And Set A Top Marginal Rate Of 25 Percent. According to AFP’s congressional scorecard for the 112th Congress, AFP took a “yes” position on the House vote on House Budget Committee Chairman Paul Ryan’s (R-WI) proposed budget resolution covering fiscal years 2012 to 2021, which, according to the House Budget Committee, included a proposal to “consolidate tax brackets and lower tax rates, with a top rate of 25 percent.” The vote was 2011 House vote 277. [AFP Scorecard for the 112th Congress, 2/1/13; House Budget Committee,4/5/11]

  • Wall Street Journal: Ryan Plan “Would Essentially End Medicare.”  According to the Wall Street Journal, “Republicans will present this week a 2012 budget proposal that would cut more than $4 trillion from federal spending projected over the next decade and transform the Medicare health program for the elderly, a move that will dramatically reshape the budget debate in Washington. […] The plan would essentially end Medicare, which now pays most of the health-care bills for 48 million elderly and disabled Americans, as a program that directly pays those bills. Mr. Ryan and other conservatives say this is necessary because of the program’s soaring costs.” [Wall Street Journal, 4/4/11]
  • Ryan’s Budget Eliminated Traditional Medicare And Created A Medicare Exchange On Which Seniors Could Purchase Private Plans.  According to the Congressional Research Service, “Individuals who become eligible (based either on age or disability) for Medicare in 2022 and later years would not be able to enroll in the current Medicare program. Instead, they would be given the option of enrolling in a private insurance plan through a newly established Medicare exchange.” [CRS Report #R41767, 4/13/11]
  • Under Ryan’s Medicare Plan, Size Of Premium Support Payment Would Be Reduced In Line With Each Recipient’s Income. According to CBO, “The premium support payments [in the Ryan budget] would also vary with the income of the beneficiary. People in the top 2 percent of the annual income distribution of the Medicare-eligible population would receive 30 percent of the premium support amount described above; people in the next 6 percent of the distribution would receive 50 percent of the amount described above; and people in the remaining 92 percent of the distribution would receive the full premium support amount.” [CBO, 4/5/11]
  • The Budget Would Index The Premium Supports To Overall Consumer Prices. According to the CBO, “the proposal would convert the current Medicare program to a system under which beneficiaries received premium support payments—payments that would be used to help pay the premiums for a private health insurance policy and would grow over time with overall consumer prices.” [CBO, 4/5/11]
  • CBO Estimated That, In 2022, When Voucher Plan Went Into Effect, Ryan’s Medicare Plan Would More Than Double A Typical 65-Year-Old Medicare Beneficiaries’ Out-Of-Pocket Costs, Increasing Them By $6,350 Per Year. According to the Center on Budget and Policy Priorities, “CBO also finds that this beneficiary’s [a typical 65-year-old] annual out-of-pocket costs would more than double — from $6,150 to $12,500.  In later years, as the value of the voucher eroded, the increase in out-of-pocket costs would be even greater.” [Center on Budget and Policy Priorities, 4/7/11]
  • CBPP Senior Fellow: Ryan’s Plan for Medicare Would Find Savings by “Shifting Large Health Care Costs Onto Seniors.”  According to Paul N. Van de Water: “Shannon, the Ryan plan would gradually replace traditional Medicare with a system of cash-vouchers, which seniors and persons with disabilities could use to help them to purchase private health insurance coverage.  While this would save the government money, it would do so by shifting large health care costs onto seniors.”  [Center On Budget and Policy Priorities, 4/13/11]
  • CBPP: CBO Report On Ryan Budget Revealed “Additional Medicare Cuts That Were Not Disclosed” In Ryan’s Initial Report. . According to the Center on Budget and Policy Priorities: “House Budget Committee Chairman Paul Ryan’s budget plan specifies a long-term spending path that means that, by 2050, most of the federal government aside from Social Security, health care, and defense would literally cease to exist, according to figures in a Congressional Budget Office report[1] that was released on Tuesday.  CBO’s report, prepared at Chairman Ryan’s request, also reveals that, as explained below, his plan envisions additional Medicare cuts that were not disclosed in the documents that the chairman released on Tuesday; and his Medicare “premium support” and Medicaid block grant proposals differ substantially from — and have much deeper cuts than — the “Ryan-Rivlin” plan of last fall, which itself was rejected as too severe by the Bowles-Simpson fiscal commission.”  [Center On Budget and Policy Priorities, 4/7/11]

Paid for by American Bridge 21st Century Foundation