According to news from the Centers for Medicare & Medicaid Services today, beneficiaries over 65 who have been paying $96.40 a month in Medicare Part B premiums, will see their premiums rise next year to $99.90. This is significantly less than the increase predicted by CMS for 2012.  New Medicare enrollees who have been paying $115.40 a month will actually see their premiums go down. The Part B deductible decreases as well, by $22, and premiums for Medicare's Part D prescription benefit will remain unchanged for 2012.   Today’s Medicare announcement follows news last week that seniors will receive a 3.6% Cost of Living Adjustment (COLA) in their 2012 Social Security checks.  That means the average retiree will receive a nearly $40 per month increase in their Social Security checks even including the Part B premium increase. “Today’s Medicare announcement is truly welcome news for millions of seniors worried that healthcare costs would once again eat away at this year’s COLA. For the first time in many years, most retirees can count on actually seeing an increase in their monthly check.  We’ve said all along that healthcare reform was vital to strengthen and improve Medicare for seniors and that given time the benefits would be undeniable.  Today’s announcement is further proof of exactly that.  Rather than trading away benefits in a so-called ‘grand bargain’, Congress should heed the lessons provided in today’s announcement.  Instead of cutting seniors’ benefits in the name of deficit reduction, we should be building on the successful reforms already passed to continue improving Medicare efficiencies while reducing costs.  The Affordable Care Act has shown we don’t have to cut benefits to seniors to save money in Medicare. The question is -- is the Super Committee even paying attention?” Max Richtman, President/CEO

According to the Congressional Budget Office and Standard and Poor’s, Medicare spending growth has dropped sharply from an average of 9.7 percent a year from 2000-2009 to less than 4 percent since the passage of health care reform in 2010.  Compare that to the fact that spending growth by commercial health insurers climbed by 7.35 percent from May 2010-May 2011 while Medicare claims rose by just 2.6 percent for that same one year span.  Of course, these facts fly in the face of Washington conservatives’ crisis calls claiming we can’t afford Medicare. Their solution is to slash benefits, raise the eligibility age, shift costs to seniors or gut the program entirely to create CouponCare.  This same group also wants to repeal healthcare reform before there’s any chance seniors can see the improvements to Medicare that come as a result of the Affordable Care Act.

“It is an article of faith, at least among conservatives, that as long as Medicare remains a government program, outlays will rise relentlessly, year after year. Only “the market” could possibly tame Medicare inflation, they say. The fear-mongers argue that unless we either shift costs to seniors; raise the age when they become eligible for Medicare; or turn the whole program over to private sector insurers, Medicare expenditures will bankrupt the country.  Here is the truth: Both Standard & Poor’s (S&P) and the Congressional Budget Office (CBO) now have 18 months of hard data showing that Medicare spending has begun to slow dramatically. Health reform legislation has not yet begun to kick in to pare Medicare payments, but something is changing on the ground. As I pointed out in an earlier post, Medicare spending began to plunge in January of 2010. After levitating by an average of 9.7 percent a year from 2000 to 2009, CBO’s monthly budget reports show that Medicare pay-outs are now rising by less than 4 percent a year.”  Maggie Mahar, Taking Note Blog, Century Foundation

Maggie Mahar has written two detailed descriptions of how and why this is happening, even before full implementation of health care reform in 2014. 

“What is striking about the recent dip to 4 percent, is that this time around, there have been no major policy changes in Washington. Over the past 18 months, neither benefits nor payments to providers have been reduced in any significant way. The Affordable Care Act does call for cutting overpayments to Medicare Advantage insurers, while shaving annual increases in payments to hospitals, nursing homes and other institutional providers by 1 percent a year over ten years. But these changes have not yet taken effect.  This slow-down is not a result of Congress cutting Medicare spending. Instead, as former White House health care adviser Dr. Zeke Emanuel pointed out in Part 1 of this post,  providers are “anticipating the Affordable Care Act kicking in 2014.” They can’t wait until the end of 2013, he explained: “They have to act today. Everywhere I go,” Emanuel, told me, “medical schools and hospitals are asking me, ‘How can we cut our costs by 10 to 15 percent?’ They know that they must trim their own costs if they are going to lower the bills that they send to Medicare.’" Like Orszag, Emanuel is seeing a “shift toward value in the health sector.”

We must allow Medicare reforms that focus on improved outcomes while lowering costs and don’t target beneficiaries for severe and debilitating benefit cuts to be given a chance to work before jumping on a deficit bandwagon that directly targets America’s seniors for benefit cuts.  Washington’s new “Super Committee” appears ready to consider many of the destructive proposals pushed by fiscal hawks targeting Medicare beneficiaries to foot the bill for our debt reduction.  Rather than targeting beneficiaries, these “Super Committee” members should build on the successes already seen in health care reform.

Max Richtman, NCPSSM Executive VP/Acting CEO

Sometimes the “good old days” really weren’t all that good and turning back the clock actually means turning our back on progress. This is especially important to remember as we celebrate Medicare’s 46^th birthday.  When President Johnson signed Medicare into law on July 30^th, 1965, 51% of America’s seniors were uninsured and 30% lived in poverty.  Healthcare was unavailable for millions of retirees who private insurers wouldn’t cover because they were considered too big a risk. Today, the senior poverty rate is at 7.5% thanks to Social Security and the Medicare program which American retirees can count on to help keep them healthy.  Unfortunately, these simple facts are largely ignored in Washington’s current race to gut our social safety net in the name of deficit reduction.  As we celebrate Medicare’s 46 years of success, the threat to the program’s future has never been as serious as it is today. The current atmosphere in Washington is one in which decimating programs like Medicare has become a fiscal litmus test for being considered an “adult”, “serious” or even a political badge of honor.  However, once you step outside Washington it is clear Americans of all ages understand we don’t have to destroy vital programs like Medicare to be fiscally responsible.  That message has been delivered loud and clear in town halls nationwide and in poll after poll.  Politicians who ignore the real-life impact these cuts, caps and coupon proposals will have on beneficiaries and their families will certainly find they will not be rewarded for their supposed “political courage” come Election Day. The fact is Medicare isn't broken but it is plagued by the same problems confronting our healthcare system nationwide.  Rising health care costs are eroding family resources, undermining our ability to compete in the global economy and creating fiscal burdens that crowd out other important investments of social capital. That's not a Medicare problem, that's a healthcare problem.  Yet, many conservatives in Congress continue to urge repeal of the only law to reform our healthcare system in a generation. They’d prefer "reforms" that shift the burden to seniors rather than address the real issues of cost-containment. The GOP/Ryan budget plan would replace the current Medicare program with vouchers and leave seniors and the disabled – some of our most vulnerable Americans – hostage to the whims of the private marketplace. Over time, this will destroy the only health insurance program available to 47 million Americans. Vouchers are strategically designed not to keep up with the increasing cost of health insurance -- that is why they save money.  Rather than destroying Medicare and replacing it with vouchers, raising the eligibility age and barring a growing number of retirees from enrolling in the program, or shifting even more costs directly to seniors, Washington’s goal should be to provide the healthcare retirees need at a cost we can afford.  We should continue the course laid out in healthcare reform legislation, which adds 8 years of solvency to Medicare by reducing massive overpayments to private insurers, while also eliminating the doughnut hole in the prescription drug program, and providing other valuable improvements for beneficiaries.  Medicare is already far more efficient than private insurance and without it millions of America’s seniors simply could not afford health coverage.  Some might die prematurely and many more would suffer needlessly due to a lack of health insurance.  Medicare is truly an American success story and one we should be celebrating this July. Unfortunately, these facts are seldom voiced by those in Washington all too eager to make this year Medicare’s final birthday.

The ongoing quest to balance the budget on the backs of America’s seniors continues with the latest Medicare plan offered by Senator Joe Lieberman and Senator Tom Coburn (who left the Gang of 6 negotiations because that bipartisan group wouldn’t slash seniors’ programs enough).  Rather than reigning in the skyrocketing costs of healthcare system wide (not just in Medicare), increasing efficiencies or even rooting out inefficiencies this plan puts the burden of a nationwide healthcare crisis directly on America’s seniors:  “Most of the plan's savings would come from some form of benefit reductions or cost-shifting to seniors — a stark contrast to the Medicare cuts believed to be on the table in talks over the debt ceiling. Negotiators there are looking at cuts to healthcare industries after Democrats drew a line in the sand over benefit cuts. But Lieberman and Coburn's proposal includes several politically risky benefit changes, such as making seniors pay more for their prescription drugs. It also would raise the eligibility age for Medicare. The proposal would cap seniors' out-of-pocket costs depending on their income. The maximum would be set at $7,500 for people making less than $85,000 per year. Seniors with twice as much income would pay three times more in out-of-pocket Medicare costs. Seniors also would pay more for their prescription drugs. Premiums only cover about 11 percent of the total costs for Medicare Part D, the senators said. They would require seniors to pay the full cost of their drug coverage. They said the change would free up between $5 billion and $10 billion in tax money. The plan also would increase premiums for Medicare Part B, which covers drugs that are administered by a doctor. Part B premiums are more than $400 per year, and taxes currently cover only about a quarter of that cost. High-income seniors would have to pay the full cost of their Part B premiums under the Lieberman plan.”  The Hill Not so surprisingly, this proposal is all pain for seniors with absolutely no attempt to raise revenues.   “Lieberman gave up an income tax hike that he previously said would be part of his proposal.  ‘The sooner you take the strong medicine, the sooner you will get healthy again,’ [he] said.” In other words, America’s seniors must continue to take Washington’s version of “strong medicine” so the nation’s largest corporations and wealthiest citizens can continue to stay healthy.

Cutting Medicare and Social Security is NOT Fiscal Responsibility A new round of radio ads, part of the “Hands Off Campaign” sponsored by The National Committee to Preserve Social Security and Medicare (NCPSSM), began airing June 6^th on radio stations in six Congressional districts nationwide:  Florida’s 9^th & 22^nd, Pennsylvania’s 3^rd & 11^th, Wisconsin 7^th and North Carolina’s 11^th.          This is what our Executive VP told had to say about the Florida ad campaign:

 “Congressmen Bilirakis and West both voted in support of the GOP/Ryan Budget bill, which would destroy Medicare as we know it.  That vote is out of touch with the vast majority of Americans of all ages and political persuasions who do not want to balance the budget by cutting Medicare or Social Security. This ad campaign is designed to remind these members of Congress that Americans do not support trading away Medicare’s guaranteed coverage for a privatized voucher system that would double seniors’ costs in the future.” Max Richtman, Executive Vice President/Acting CEO

Along with their opposition to cutting Medicare, a recent Social Security poll of likely Florida voters showed that strong majorities declare they’ll support the candidate who argues for protecting this vital program rather than cutting it to pay down the debt. The Florida radio buy is just one part of the National Committee’s “Hands Off Campaign”. Launched earlier this year, the campaign continues to organize and inform older Americans about the ongoing budget debate in Washington and its impact on programs touching the lives of virtually every family.  Other elements of the campaign include:

• Engaging our large and growing communities on Facebook, Twitter and our Blog “Entitled to Know” in a number of ways to keep the pressure on. 
• Thousands of E-cards have been delivered to the key political players in Washington who are deciding the fates of these vital programs.
• The National Committee’s Truth Squad busts myths and provides the facts about Social Security, Medicare and our fiscal crisis.
• National Committee members and supporters have delivered more than 1 million letters and petitions to Congress urging Washington to preserve Social Security and Medicare rather than targeting these vital programs to balance the budget.  

 The National Committee has a successful track record in protecting the Social Security and Medicare benefits paid for by American workers and retirees including the fight to defeat President Bush’s proposals to privatize Social Security. By engaging and informing America’s seniors through similar ad campaigns, member mobilizations and grassroots efforts nationwide,  our members have said, loud and clear, they’re ready to fight against those in Washington willing to trade away the nation’s most successful government programs.