By Erik Wasson - 03/31/11 12:51 AM EDT
House Budget Committee Chairman Paul Ryan (R-Wis.) will largely give Social Security a pass in his highly anticipated budget while proposing a significant overhaul of Medicare and Medicaid, according to sources briefed on the plan.
The 2012 budget resolution, which committee Republicans are still finalizing, is scheduled to be unveiled on Tuesday. It will not back specific benefit cuts to Social Security or suggest raising the retirement age, sources said.
Ryan is also not planning to include a proposal that would allow recipients to invest their Social Security payroll taxes, something Democrats have attacked as a “privatization” of Social Security. Such attacks doomed a 2005 effort by then-President George W. Bush to reform the system.
By not proposing specific changes to Social Security, Ryan dodges expected arguments from Democrats who have repeatedly warned that the GOP intends to dramatically change a program popular with many voters and particularly senior citizens.
“We will have other opportunities to address Social Security,” Budget Committee member Jason Chaffetz (R-Utah) said.
“I wouldn’t be surprised if it says nothing about Social Security,” freshman Rep. David Schweikert (R-Ariz.) said. “The biggest contributors to the debt are the healthcare programs.”
Rep. Tom Cole (R-Okla.) said Medicare and Medicaid will “definitely” be tackled in the budget blueprint, though demurred on Social Security, saying talks were ongoing.
Budget Committee spokesman Conor Sweeney would not confirm or deny the details of the draft resolution on Wednesday. He said it is “premature to speculate on specifics.”
“Chairman Ryan has committed to put forward a budget that deals with the drivers of the debt,” Sweeney said. “He has committed to put forward a budget that helps spur job creation and economic growth. He has committed to put forward a budget that helps save the nation’s critical health and retirement security programs.
“By contrast, given their refusal to lead, the president and his party’s leaders are committing the nation to the bankruptcy of these programs, the bankruptcy of the federal government and a debt-fueled economic crisis.”
Senate Majority Whip Dick Durbin (D-Ill.) warned this week that a long-term deal to reduce the deficit would be hard to reach if it includes reforms to Social Security, while Senate Majority Leader Harry Reid (D-Nev.) said he would not be willing to make changes to the program for decades.
In contrast, Democrats have suggested they could be ready for cuts to Medicaid. Advocacy groups were recently briefed by Democratic staff who asked that they support some cuts to that program.
Ryan also is tackling the biggest drivers of the deficit in proposing reforms to Medicaid and Medicare while leaving Social Security largely untouched. The Budget Committee chairman has proposed reforms in the past, however, and while Social Security is not a driver of the $1.6 trillion budget deficit, its trust fund will be unable to meet its obligations beginning in 2037.
President Obama’s debt commission last year recommended raising the retirement age to 69 by 2075 and changing how inflation is calculated in order to shore up Social Security. It also proposed changes to Medicare and Medicaid, significant tax reforms and cuts to defense and discretionary domestic spending.
The fiscal commission garnered some Democratic votes, but has drawn a massive negative response from Senate Democratic leaders over the Social Security recommendations.
Members briefed on Ryan’s budget plan — which as a general rule would not make substantive law but would lay out his party’s policy vision — acknowledged that Medicaid and Medicare reforms are more fleshed out.
Ryan’s budget will propose that the federal share of Medicaid be converted into a block grant. Options on how to do this were still being discussed by committee Republicans on Wednesday.
This would save the federal government money because the share of costs would be converted to a fixed dollar amount that rises according to inflation, rather than automatically to match healthcare costs.
On Medicare, the budget will propose a modified version of what has become known as the Ryan-Rivlin voucher proposal, named after Ryan and former Office of Management and Budget Director Alice Rivlin.
Under the Ryan-Rivlin plan, citizens who turn 65 in 2021 or later would not enroll in the current Medicare program but instead would receive a voucher to buy private health insurance.
The budget resolution will propose something more like “Medicare Advantage for everyone,” members said. Under such a plan, future retirees would have a range of private plans to choose from and a federal payment would go to the plan, rather than to the individual retiree. The idea is to inject competition into the system to lower costs.
The Congressional Budget Office in November said the Ryan-Rivlin plan and block granting of Medicaid would save $280 billion, but has the potential for much greater savings in future years.
Ryan’s budget will contain no new taxes and will extend all the Bush-era tax rates, something that makes balancing the budget harder in technical terms.
Ryan has said that the Social Security issue would be a potent political weapon against Republicans in the next election, and GOP freshmen, eager to see their party tackle the deficit, said they weren’t concerned if his budget didn’t tackle reforms to the program.
Schweikert told The Hill Wednesday that for him and other freshmen, the Ryan budget is much more important than the current fight over 2011 spending.
“That document is everything,” he said.
“I am not going to attempt to be the Budget Committee chairman,” Rep. Tim Griffin (R-Ark.) said when asked what he needs to see. “We absolutely have to have a budget that takes the spending curb and bends it back.”
Julian Pecquet and Bob Cusack contributed to this article.