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Paul Ryan on the Future of Health Care & how Congress can make quality care more affordable

Paul Ryan on the Future of Health Care & how Congress can make quality care more affordable

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By: AIF Staff

Janesville, WI: Last week, American Idea Foundation President Paul Ryan discussed the future of health care on Health 2049, a podcast hosted by Bisi Williams and Jason Helgerson. The podcast features thought leaders sharing their recommendations, perspectives, and views on what health care might look like in the year 2049.

 In a wide-ranging conversation, Ryan discussed his experiences trying to advance health care reforms during two decades in Congress. He also detailed his preferences for reforming the social safety net and for moving to a more patient-centered health care system that promotes universal access to quality, affordable care and focuses on innovation, competition, and choice.

Paul Ryan, Former Speaker of the House and Founder of the American Idea Foundation

To listen to Speaker Ryan’s entire interview on Health 2049, click here. Excerpts of Ryan’s responses, edited lightly for clarity, follows.

Breaking the policy gridlock by putting ‘ideological sabers aside’:

“We spend two times what anybody else spends per person on health care in the world, but we don’t have a system twice as good as anybody else. It’s nothing close, so I think we can get to that. I think we spend enough money. I think it’s the way we spend our money that needs to be changed and I think we need to have a system that accommodates and encourages competition and choice.

“This also means we have to put the ideological sabers aside. From my side, let’s accept universality. Let’s accept that the government is going to be involved. On the left, let’s accept the private sector is going to be involved as well. This cannot be a government granted right where the government decides, controls and rationalizes healthcare.

“I think both sides of ideological extremes need to be pushed to the side. And I think there’s a center, I’d like to say center-right, but a center-based system that can be had.”

Developing an initial interest in health care policy:  

“I was primarily a fiscal policy guy concerned about debt, deficits, and the dollar as the world’s reserve currency. When you dig into those issues, it basically takes you to the entitlement programs and when you dig into that, it takes you to health care. So, I walked into the health care issue a little later, about two terms into my tenure in Congress because it became very clear to me that this was the biggest fiscal challenge of our country. And I was representing Southern Wisconsin where this was a big concern, a big issue for my constituents, so it became really clear to me that I needed to learn more about health care.

“I spent a number of years just trying to learn about health care from providers, from consumers, from economists, and then I spent a lot of time with the Committees, with the Joint Committee on Taxation, with the Congressional Budget Office, the think tanks, and in the Budget Committee. I was Chairman of Budget and Chairman of Ways and Means, which are the primary health care committees, so I spent a great deal of my time on this issue….

“I produced a number of different bills: Some passed, many didn’t. I had, with Senator Tom Coburn, the conservative alternative to the Affordable Care Act in 2010 and then I built budgets around health care proposals. I’m currently working on something right now with Jim Capretta at the American Enterprise Institute, to be released later in 2022, so I still spend time on the issue.”

What health care might look like in 2049:

“I hope that we have a fully-funded system that does not have trillions of unfunded liabilities and that is not saddling the next generation with insurmountable debt. I hope this system is characterized as one where everyone has healthcare coverage and you have a system where the health inflation rate is nothing like what it is now and it’s closer to the actual nominal inflation rate, which, frankly, is kind of high right now.

“it’s a system known for and driven by innovation, choice and competition, where markets work. It’s a system where markets are designed in such a way to protect those with pre-existing conditions, and that the preferences and fiscal policy are aimed towards helping the sick and the poor, but that everyone has access to a system where they are guaranteed coverage. It is also a system where those with tough health conditions don’t go bankrupt if they get sick. I believe that this is absolutely achievable.”

Two paths for the future of American health care:  

“I think we currently have a system right now that is a fiscal train wreck and we are piling on top of the system unfunded liabilities, which will make for a very, very difficult moment fiscally, right around 2049 actually.

“I look at 2049 and I see either a fiscal train wreck where we lose the dollar’s status as a reserve currency and we have to do immediate budget surgery to the budget where we have to cut benefits back in real time for real beneficiaries, and people who are dependent on these programs and who organize their lives around these promises that have been made by government.

“Or, and this is the glass half-full side of things, things that I think and hope will happen, which is we have a system that doesn’t have a fiscal train wreck, that doesn’t bankrupt the country or our entitlement programs, that is market-based, and that takes taxpayer dollars and puts them where they ought to be, which is toward the sick and the poor.

“As I mentioned, I hope we have a system where you have legitimate health insurance competition and innovation. A system where the American system of innovation is alive and well and we come up with new drugs and new therapies to make our lives healthier, happier, longer. I believe that that’s eminently achievable.

Advancing Patient-Centered reforms to improve health care:

“I have a few white whales in my career that I wanted to slay, that I could never get, one of which is the tax preference for health insurance. The tax exclusion is upside down. We give the biggest tax benefit to the highest income earner and the lowest tax benefit to the lowest income earner. By excluding health care benefits from your job from taxation, the higher the tax rate you have, the bigger the subsidy you get. That is completely wrong. It is the biggest tax expenditure in the tax code. I tried to cap it when I was Speaker and I couldn’t even get the votes for that among Republicans. And the Democrats tried it with the Cadillac Tax, which is very controversial on their side as well and keeps getting pushed around, but so I think Obama was going at it the wrong way with the right idea with the Cadillac Tax. 

“What I wanted to do is repeal that tax exclusion. I wanted to convert it to a fixed, refundable tax credit so that more of the money goes to low-income individuals and families, less to upper-income individuals. We should throw a deduction on top for those people and allow people to take that refundable tax credit to buy health insurance….

“And when you roll into retirement, I’m a big believer in a premium-support model for Medicare. They should be set on a bid-based pricing system so that market bids are what set the rates. Even the Congressional Budget Office, under Doug Elmendorf, built a model that showed it’s the smartest way to reform Medicare. I think this would put Medicare on a much better footing. It reduces the unfunded liability and if we go to a premium-support model with Medicare — with more for the poor, more for the sick, less for the healthy and the wealthy within the Medicare system, where you have a number of plans to choose from, to a premium support model, much like the federal employee health benefit plan, I think you can mitigate or avoid a debt crisis.

“The fee-for-service system, which is more than half debt-financed, is tumbling toward a debt crisis in about the year 2049 and, frankly, if you would convert our system to a premium support system, with the kind of system for the under 65 population that brings in choice and innovation, it would hopefully have a mitigating effect on inflation. Then, I think you’ll have a system for under 65 and for over 65 that works quite well.”

Preserving the Social Contract in a bipartisan way:

“It’s going to be ugly for a while, politically speaking, but I think the math is going to get us. I think the realization that these programs are running into fiscal reality, which jeopardizes their own viability, will spur action.

“The social contract is an important concept. It’s very important…. I see the social contract as extremely important — a viable safety net for the poor, health and retirement security for those who are in old age, and then all the other things we talked about in between.

“For that to be sustained in this century and on, it will have to change. These were designed in the 20th century with 20th century economics, and 20th century debt demographics, all of that is changing for the reasons we just discussed and I think Congress will get there because they will have no choice but to get there. And the bond markets will make them do it.

“I think the only real viable way in the mid-term, not this year, this session, or even probably the next session of Congress, is a commission. I hate it. Like I said, I was on Bowles-Simpson, I served on some of these commissions, but I’m not a big fan of them because I think it’s Congress ducking its responsibility, but Congress is just too broken to take all of this on on their own.

“My buddy, Senator Mitt Romney has a bill with a commission where I think he has an equal number of Democrats and an equal number of Republicans to take on these entitlements and to have a forced up or down vote, like the base closing commission…. I believe the rightly-formed commission in the right Congress with the right President can put before Congress a solution to this problem that can buy us decades and really chip away at this problem and pass Congress in the medium term. I think that’s probably the best and easiest most viable path forward to solve this problem.”

Reauthorizing MIECHV & Recognizing Evidence-Based Successes in Fighting Poverty

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By: AIF Staff

The American Idea Foundation has long believed that Maternal, Infant, and Early Childhood Home Visiting (MIECHV) Program provides a useful example of how the government can move towards evidence-based programming and better allocate resources to more effectively fight poverty. As this home-visitation program is considered for reauthorization by Congress later this year, the American Idea Foundation will push lawmakers to reward MIECHV’s data-driven approach and understand the impact it is having in communities across the country.

MIECHV is a time-intensive, customized approach to helping parents from before their child’s birth through the first years of the child’s life. The First Five Years Fund summarized the program’s approach well, stating:

“Evidence-based home visiting programs, like those made possible by MIECHV, pair families with limited support and resources with trained home visitors such as nurses, social workers, and educators. Home visitors meet with families at home and work with families from pregnancy through their child’s kindergarten entry to help lay the foundation for the health, education, development, and economic self-sufficiency of the entire family. Visits by caring, experienced professionals can turn good intentions into good parenting, breaking generations-long cycles of poverty, addiction, abuse, and despair.”

MIECHV is administered by the federal government through grants to states, territories, and tribes allowing these entities to create voluntary programs, backed by data and evidence, to help families and parents build happy and healthy homes for children. It is results-based and has been subject to more rigorous evaluations than any other single poverty-fighting program.

At a recent hearing held by the House Ways and Means Committee, Congresswoman Jackie Walorski of Indiana highlighted the program’s success – and the reasons for it, saying in part:

“MIECHV is a program that gets results. This program builds upon decades of research that proves home visits by a nurse, social worker, or other trained professional during pregnancy and in the first years of a child’s life help prevent child abuse and neglect, support positive parenting, improve maternal and child health, and promote child development and school readiness….

“The program is now up for reauthorization again this year. What makes MIECHV unique is that funding is tied to evidence. Most federal programs operate in a black box. Less than $1 out of every $100 the government spends is backed by even the most basic evidence that the money is being spent wisely. Unlike most federal social welfare programs, we know what outcomes taxpayers can expect from our investments in MIECHV. This program serves as a model for how other programs for low-income families should be funded.

“For a home visiting model to earn taxpayer support, an evaluation must prove the program has demonstrated significant, positive outcomes such as preventing child abuse and neglect, improving maternal and child health, and improving economic independence…. As we turn to reauthorization, Republican priorities include providing a full 5-year reauthorization to give states and implementing organizations the certainty they need to conduct long-term planning.

“We aim to raise awareness of MIECHV’s high-quality outcomes to promote this time-tested program. And, we must apply lessons learned during the pandemic, specifically from the success of remote visits that grew efficiency while preserving the positive outcomes we expect from this evidence-based model.

“Few federal social programs have been evaluated to determine if they are working, and almost none have conditioned funding on evidence of effectiveness. When we spend limited taxpayer dollars to help those in need, we must ensure we’re investing in programs that deliver results.”

Without question, MIECHV is a bipartisan success story, supported by the administrations of Presidents Bush, Obama, Trump, and now Biden. Most recently, the Biden Administration announced millions in grants via the American Rescue Plan. There was a tremendous amount wrong with the American Rescue Plan, but funding MIECHV at more robust levels was right.

The evidence of MIECHV’s positive impact on children and families has been well-documented and the American Idea Foundation’s visit to a South Carolina Nurse Family Partnership program provided a visual testament to the difference its making in people’s lives.  

To learn more about the program’s impact, watch: Lessons from the Front Lines of South Carolina.

The American Idea Foundation believes that the condition of your birth should not determine the outcome of your life, and the MIECHV program provides a worthwhile example of how the federal government, working in tandem with researchers and organizations at the state and local level, can ensure that all children have the opportunity to succeed and lead productive lives. It is an approach that should be replicated as leaders work to meet other pressing policy challenges.   

On “Hardly Working” podcast, Ryan discusses why evidence-based policymaking is essential to fight poverty effectively

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By: AIF Staff

Washington, DC – Earlier this week, American Idea Foundation President Paul Ryan was a featured guest on theHardly Working podcast. The podcast, hosted by Brent Orrell and produced by the American Enterprise Institute (where Ryan is a visiting fellow), focuses on the future of workforce development and on how policymakers can help individuals meet the diverse needs of the 21st century economy.

During the podcast interview, Speaker Ryan and Orrell discussed using evidence-based solutions to break through partisan gridlock, the amazing accomplishments of the Nurse-Family Partnership program, and other ways to successfully fight poverty.

Listen to the entire interview here or by clicking the icon below. Highlights of the conversation, edited slightly for clarity, follow.

The genesis & aims of the American Idea Foundation:

“After I retired as Speaker of the House, I wanted to focus on some of the things I really cared about which are poverty and strategies to improve our fight against poverty. I wanted to help go after poverty’s root causes and help break the cycle of poverty. There are different kinds of poverty, but I wanted to focus on intergenerational poverty and it’s just a perfect segue to what we are talking about which is the last law I wrote in Congress. It’s this thing called the Evidence Act.

“It’s a bill that I did with Senator Patty Murray. We founded this [Evidence-Based Policymaking] Commission and we got the idea from Jim Sullivan at Notre Dame, economists at their Laboratory for Economic Opportunities, and Raj Chetty, an economist at Harvard…. We put Ron Haskins from the Brookings Institution in charge of it because I wanted to make sure this was not seen as some Republican thing, but rather just a good thing. The Commission gave us its results, we took them and put them in a bill and got it through Congress….

“Now, academic researchers can look at the data and see what works and what doesn’t and then get the government to actually measure the results of programs, the effectiveness of programs, and whether something works or not.  [It helps] get the muscle memory built in the minds not just of the bureaucracy, but of policymakers and of philanthropy to focus on evidence-based policymaking, so that we can bypass the ideological loggerheads….

“So, my foundation is basically focused on what I would call center-right ideas for fighting poverty and restoring civil society and reproducing upper mobility that we aspire to as Americans. It’s called the American Idea Foundation and I’d say the “American Idea,” or at least what we think of, is that the condition of your birth should not determine the outcome of your life.

“America is the only country founded on natural rights. It’s a beautiful thing. We are the only country that’s founded on an idea and it’s the job of Americans to pass this on to every generation.

“My foundation is trying to do that by making sure that we’re [using] evidence as a policy-making barometer and as a tool in government and out of government. Then [we’re trying to support] those things that connect the private sector, the public sector, and the philanthropic sector to get capital into poor communities, to get the private sector into poor communities.”

An evidence-based success story: The Nurse-Family Partnership program

“I’ve been to the Nurse-Family Partnership programs in Kenosha and Racine and I was just down in rural South Carolina last month touring [their program]…. The Nurse-Family Partnership is where a nurse partners with an expectant mom and they become very close. They become friends and the nurse effectively acts like a mother or a mentor – that’s probably a better word, a mentor to the expectant mother to help her figure out what you have to do to have a healthy pregnancy. The nurse says these are the vitamins, this the diet, these are the things you don’t do, these are the things you do, and here’s how you get prepared. No one else would tell [these mothers] this and then after they’ve had the baby, they help them for [two] years… with all those other things in infancy and it has huge impacts on a child’s development.

“The program has been subjected to randomized controlled trials (RCTs) and we’ve been running evidence and analytics on this program for years. I first got involved with it in the George W. Bush Administration which grew the program. President Obama was enamored with it and they expanded it and then President Trump saw it and he reauthorized it. So, it grew under Bush, Obama, and Trump, three very different Presidents.

“It’s a program that just has really good evidence that proved [its concept]. It’s teaching women who are having babies…. how to be good moms and how to raise those kids and how to do so at a really critical stage of development from pre-birth to three years old.

“It’s extremely successful. Those nurses and those moms become extremely close, and they help these moms really ratchet themselves up the ladder of life, up the escalator of upward mobility, and get them on a really good path, putting their life together so the mother is better off. And if she’s going to be better off, we all know and it’s really clear that her child is going to be better off.

“This is an example of a government program and of civil society working to actually alter people’s trajectory and change society for the better…. For moms who’ve never had a baby and who didn’t know how to raise a baby, there is a good program that actually works. And if we prove that it works, then let’s fund it and let’s take the money from the programs that have been proven not to work and use that so we don’t actually net increase spending.”

Focusing on outcomes, not dollars spent, to better fight poverty:

“For lack of a better phrase, the War on Poverty got gripped by an ideology and because of that ideology, we started to measure success by throwing money at problems. We measured success by inputs like money or creating new programs.

“In many ways, they created this notion of “just let the government do it” if we’re trying to fight poverty and trying to get people out of poverty. [It was a notion of] don’t worry, pay your taxes, the government has got this figured out. [The government] will create programs to deal with this, as if that is a perfectly decent substitute for communities, for mediating institutions, for people helping fix problems person to person or community to community. They decided big is better. [They decided] the federal government is more efficient and they can just design programs and therefore materialistically [the government] can solve this problem.

“It blew up in our faces. It created a lot of dependency and it backfired. Materially taking people out of poverty, from a technical perspective by throwing money at the problem – sure, you can do that — but have we really created a society enriched with upward mobility, with people living the best versions of their lives and becoming the best versions of themselves? Did these policies do that? No.

“I think what is missing is the sense of community, the sense of solidarity, the mediating institutions that civil society provides. We displaced people participating in helping the lives of one another…. You can’t just substitute [government] for the private sector and for economic growth, wage growth, competition for labor, innovation, opportunity, social capital and all that comes with it.

“I think we went down this path in the War on Poverty of just getting rid of the secret sauce that makes all this stuff work and substituting all of it for more programs, more money, more dependency and [we’ve seen] predictable results.”

Strengthening civil society in an era of digitization and polarization:

“We are in real trouble right now because of digitization. I think we are living more artificial lives on our electronic devices and it is actually bringing atrophy to these mediating institutions — our churches, our civic organizations, the place and space where we live our lives, the space between our government and ourselves.

“And there’s also capital. Obviously, you have to have investment. You have to have organizations that promote civil society and all these things that help people realize their humanity and that work with one another to do that….

“The best thing I can come up with is we have to revitalize those institutions and revitalize civil society. We have to revitalize those non-government organizations and, since we’re becoming less religious as well, it is these non-government organizations that connect us and give us a sense of value and pride in helping other people. They give us this common good sense of community. If you’re raising kids — and I’ve got two that still have to get through high school, you’re really involved in this stuff but once you’re done with that, everybody leaves and that’s what’s sort of happening in society today.

“I wish I could say there’s a government program or a bill with the capacity to fix this but there really isn’t a way other than to have a good, healthy, growing economy so people have discretionary income, so they have more hours at home, working on these parts of their community.”

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