We can always count on the GOP...

to bury themselves once they get a little power back. Thank you Paul Ryan for potentially getting back most of the seats lost in the last election.

Capitol Hill (CNN) - As families make their 2011 summer plans, we here at American Sauce are thinking about 2011 summer politics. The Medicare plan from House Budget Chairman Paul Ryan, R-Wisconsin, is a clear, early contender, to dominate town halls and political barbecues.

What's in it? That is our podcast this week. Listen here. Comment below. Or keep reading.

True, the Ryan plan is not likely to become law in the next two years. Republicans do not have the votes in the Senate or the seat in the Oval Office. And recently, the party has seemed to lift its foot gently off the gas behind the Ryan Medicare Plan.

But RyMed, let's call it that for short, is one of the key pivot points for debate on Medicare. And it is a key political dividing line over government philosophy.

But to know what lawmakers' views mean, Americans need to understand what's in the plan.

Check out our "Explain It To Me" video here. Or the cheat sheet below.

CHEAT SHEET: Ryan Medicare Plan

Basics

- Starting in 2022, Medicare would privatize. Private health insurers would take over most of the functions government performs now for Medicare.
- In general, RyMed would affect Americans age 54 and younger. Those 55 and older would stay on the current version of Medicare.
- BUT, those 55 and older would be affected in the costs of prescription drugs. The Ryan plan reopens the "donut hole," a point in the cost curve where seniors must pay full price for their drugs.

What Happens To Each Person On Medicare

- Again, starting in 2022.
- Each person on Medicare would be allotted a certain dollar amount from the government to help them buy private health insurance.
- RyMed calls this a "premium support" payment.
- Next each person would chose from a list of government-approved private health insurance plans.
- Then the government's allotted payment for that Medicare recipient goes directly to the health insurer they chose.
- The Medicare recipient pays the difference between the insurance plans costs and what the government has allotted for them.

What Does That Mean? In Dollars?

- Here's how the Congressional Budget Office looked at that in dollars.
- CBO estimated that in 2022, the government would allot $8000 for a 65-year-old, to go toward buying a health insurance plan.
- CBO estimated that the 65-year-old would then pay an additional $12,500 for that plan and for all out-of-pocket costs.

Medicare Survival

- Medicare is running out of money.
- The latest forecast from Medicare trustees predicts Medicare will completely go through its trust fund by 2024.
- At that point, money coming into Medicare will not cover the costs of current benefits.
- The Ryan plan cuts the government's Medicare costs, thereby offering one way for the system to survive.
- Ryan argues that the system cannot continue with the amount of cash coming in and the much larger amount going out for costs.
- Critics point out that the Ryan plan shifts Medicare costs from government to the individual. Individuals continue paying into Medicare at current rates, but could face increased out-of-pocket costs for the same benefits they receive now.

How Much Government Will Pay (wonky but important)

- Under the Ryan plan, the government's Medicare payments would increase by no more than the rate of inflation each year.
- Ryan sets the inflation rate at CPI-U, the consumer price index for urban consumers. That is the broadest current CPI measure.
- Other Medicare plans (Simpson-Bowles, for example), tag Medicare cost increases to GDP or the growth in the economy.
- Depending on the economy, the Ryan measure could keep Medicare costs lower for the government. But it could thereby increase the out-of-pockets costs of individuals each year.

What We Don't Know

- How much costs will go up by age. The Ryan Medicare Plan allows insurers to charge more for older Medicare recipients. Thus, an 85-year-old could have significantly higher costs than a 65-year-old.
- What the benefits look like. RyMed stipulates that private insurers have to give Medicare recipients at least the same value of benefits that Members of Congress and other federal employees receive. What that means, specifically, is unclear.

American Sauce: The Ryan Medicare Plan – CNN Political Ticker - CNN.com Blogs

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