( CNN ) -- We 've all heard that Paul Ryan is Gov . Mitt Romney 's running mate . But many still do n't know the details of his proposals for health care reform . They offer a stark contrast to what the Obama administration would like to do . Medicare . Medicare is a defined benefit program . That means the federal government decides each year what Medicare will cover . No matter what that costs , the government pays for most of it ; individuals are responsible for the rest . Ryan 's original plan , passed by the House of Representatives ( but not the Senate ) last year , would have changed Medicare to a defined contribution program , where the government would instead decide every year what it will pay . Under his plan , the government would give seniors that amount of money , in one form or another , to buy insurance on their own . Seniors would have had to pay for the difference between the cost of the insurance and the amount the government was willing to pay . The problem was that his original plan saved money by limiting how quickly the voucher seniors would get to buy health care would grow . This meant that by 2030 , seniors would have been responsible for 68 % of the cost of their insurance , likely too much for most to afford . At the end of 2011 , though , Ryan made significant alterations to his proposal . With Democratic Sen. Ron Wyden , he produced a plan that more closely resembles Romney 's ( although he changed things again in his 2013 budget , which Wyden does not support ) . Instead of tying the amount of the voucher to an arbitrary increase in the future , it would be tied , in his 2011 proposal , to how much insurance costs . Each year , companies will submit bids for how much it will cost to provide insurance for a senior that year . The voucher would then be set at the price of the second-lowest bid . In other words , seniors could get the second-cheapest plan for very little . If they chose the cheapest plan , they would actually get a rebate . If they want anything more expensive , they would have to pay for the difference . Moreover , traditional Medicare will be one of the choices . If it is the second cheapest , not much will change . If , however , it is more expensive , then seniors would have to pay for the difference , but in this way they will have the option to keep their Medicare . There are potential concerns , however . The first is that the proposal requires that the plans be `` actuarially equivalent , '' but not that they provide the same coverage benefits . This means that plans can tweak benefits they offer to try to preferentially attract healthy customers . The second issue is that this plan wo n't save near the money that Ryan 's first attempt did . If this plan had been implemented in 2009 , it would have saved the federal government 9 % that year . But that would have been a one-time savings , and it would n't bend the cost curve much at all . Moreover , seniors would have had to pay about $ 64 a month for their traditional Medicare , which is a significant amount for many of them . A third concern , voiced by many who oppose the Ryan plan , is that the details are insufficient to assume that traditional Medicare will be preserved . There may be a good reason for this : If the Affordable Care Act is too radical for many wishing to pass this proposal into law , it 's hard to imagine they 'll be in a position to defend something far more specific and comprehensive . Most significantly , though , this whole plan rests on the same rationale as Medicare Advantage did ( it lets Medicare beneficiaries get their coverage through private insurance companies ) when President George W. Bush first proposed it . That did n't clearly work . Many private plans were unable to come in under traditional Medicare , and only in certain markets in the country . Medicaid . With respect to Medicaid , Ryan ( and Romney ) would like to get the federal government far less involved . They want to convert the current program , where benefits are set at the federal level , and costs are shared between the federal and state governments , to one in which states are given far more flexibility to set benefits , and a block grant payment with which to pay for them . Some states like this plan , because it will allow them to alter benefits and coverage locally so they will be on the hook for less money in the future . Even though the federal government covers somewhere between 50 % and 75 % of Medicaid costs right now , the remaining spending is still a significant drain on state budgets . Unfortunately , savings to the federal government would come from drastically cutting the amount of money they will give states in the future . The only way states would be able to provide insurance to Medicaid recipients on way less money would be if they reduced the benefits or the number of beneficiaries . If benefits are n't cut , and already low provider reimbursements are n't further reduced , then by 2021 about 19 million people , or one-third of all people on Medicaid , will need to be dropped from coverage . Many of those covered by Medicaid are very poor elderly people , or those who are blind or disabled . If states acted to preferentially protect those groups from cuts , then 27 million other people , many of them children and pregnant women , would be dropped from Medicaid . Although it will likely get far less media attention , the changes to Medicaid may be far more radical . Medicaid is already one of the cheapest forms of insurance around . There is n't that much fat to be trimmed , regardless of how much states might `` innovate . '' Although the focus of much of the election will be on Medicare , these proposed changes to Medicaid are far more severe , and will have far more immediate repercussions . The choice . The Obama administration would like to reduce future health care spending by a number of means , including Accountable Care Organizations , the Independent Advisory Board and other programs that focus on providers and hospitals to save money ( discussed on CNN.com here ) . They believe , in general , that relying on experts and leaning on providers can bend the cost curve . The problem is that some see this as rationing . Ryan and Romney , on the other hand , believe that individuals should be the lever by which spending is reduced . They propose to decrease the amount the federal government pays for care by increasing the amount individuals pay and giving them more choices . They further believe that this will drive individuals to demand lower prices . With respect to Medicare , the problem is that the amount seniors will be required to pay may be too much for many . Moreover , there is little evidence that prices will drop ( they did n't for Medicare Advantage ) , and this could result in some seniors forgoing necessary care , which will have negative health consequences . Ironically , for all the talk about the concerns over the deficit , their plan also may not reduce Medicare spending as much as the Affordable Care Act does in the next decade . In a rational world , we 'd try all these things . A bipartisan plan could come from Republicans accepting the Affordable Care Act as it stands for all those younger than 65 , without further talk of repeal , in exchange for implementing the Ryan-Wyden plan for those 65 and older . After all , that proposal is n't really much different than the way the exchanges will work in the Affordable Care Act , with the exception that there is a public option ( which should be opened to everyone under 65 as well ) . Everyone gets something they want , with all the tools available being brought to bear on containing future costs . This would require compromise , though , something that is in short supply in election years . Join us on Facebook/CNNOpinion . The opinions expressed in this commentary are solely those of Aaron Carroll .
Aaron Carroll : Ryan 's proposals for Medicare , Medicaid sharply differ from Obama 's . He says Ryan 's Medicare plan could change quality of care , increase cost to seniors . Comment: Carroll : Obama 's approach is different ; ideally a compromise would keep best of both plans .