United States SenateWashington, DC 20510

Dear Senator:

On behalf of the millions of members and supporters of the National Committee to Preserve Social Security and Medicare, I am writing to urge you – and other conferees – to ensure the conference agreement on the Concurrent Resolution on the Budget for Fiscal Year 2014 does not include reconciliation instructions or policy changes that would result in cuts to Social Security, Medicare and Medicaid benefits.  We are particularly concerned about proposals to shift Medicare costs to beneficiaries or calculate the Social Security cost-of-living adjustments (COLAs) by using the “chained” Consumer Price Index (CPI).

The chained CPI would reduce Social Security benefits for the oldest and most vulnerable Americans who would be least able to afford it.  Three years after enactment, the chained CPI would cut the Social Security benefits of a typical 65 year-old by about $130.  By age 95, the same senior would face a reduction of almost $1,400 per year.  Moreover, the chained CPI would have a harmful economic impact on every state and congressional district in the country.  In a National Committee report released earlier this month, we found that the COLA cut could result in a $31 billion loss in economic output and the loss of more than 200,000 jobs nationwide in 2023.  For an estimate of how your state’s economy would be affected by the chained CPI, please see our Foundation Report.

Social Security does not face an immediate crisis and is not driving either the short-term deficit or long-term debt. Rather than cutting the already meager benefits, Social Security should be strengthened for the long-term by increasing the current payroll tax cap on earnings.

Regarding Medicare, beneficiaries already have high out-of-pocket costs, and because over half of beneficiaries are living on incomes of $22,500 or less, they cannot afford to pay more.  However, if the budget resolution includes Medicare cost shifting proposals, seniors and people with disabilities could be required to pay a $25 increase in their Part B deductible, a $100 copayment per home health episode, and higher Part B premiums for purchasing comprehensive Medigap plans.  And, further means-testing of Medicare would mean middle class seniors would pay higher Part B and D premiums.  These proposals would shift costs to beneficiaries without solving the underlying problem of overall health care inflation, and would make Medicare more complicated and difficult to administer.

The National Committee supports a proposal in S. Con. Res. 8 to permanently reform the Sustainable Growth Rate (SGR) formula, which too frequently threatens doctors with huge cuts in the reimbursement they receive for treating Medicare beneficiaries.  Fixing the SGR formula would help ensure that seniors continue to have access to their trusted physicians.  However, we oppose shifting costs to beneficiaries to pay for increased reimbursements to physicians.

We urge conferees to reject plans in H. Con. Res. 25, which would turn Medicare into an under-funded voucher plan and block grant Medicaid.  And, we ask you to oppose proposals in H. Con. Res. 25 which would repeal the Medicare benefit improvements in the Affordable Care Act (ACA) and which would raise the eligibility age for Medicare.

Instead of cutting benefits, comprehensive reforms in the ACA that are beginning to contain costs in the entire health care sector, including Medicare and Medicaid, ought to be given a chance to work and to be strengthened.

The most vulnerable among us – Americans who depend on the social insurance safety net – should not be asked to make greater sacrifices without asking the wealthy to pay their fair share.  That’s why we urge you to support a responsible conference agreement on the budget resolution without cutting Social Security, Medicare and Medicaid benefits for seniors, people with disabilities and working families.


Max Richtman

President and CEO