NAHC & Allies Send Letter Urging Congress to Stop Medicare Cost Increase
September 28, 2016 03:56 PM
The National Association of Home Care & Hospice and a group of about 75 health care and employee groups sent a letter to Congress on September 27 urging lawmakers to prevent an increase in out-of-pocket health care costs for some Medicare recipients in 2017.
According to the 2016 Medicare Trustees Report, Part B premiums are currently scheduled for a big increase in 2017, from $121.80/month this year up to $149/month, a bump of 22 percent. The trustees also estimate the Part B deductible will rise from $166 to $204 next year for all enrollees.
The increase is happening because of a “hold harmless” provision that forbids Medicare Part B premium increases from being larger, in dollar amount, than the beneficiary’s Social Security cost-of-living-adjustment (COLA). This rarely matters because Social Security benefits are much larger than a beneficiary’s Part B premium. However, last year there was no COLA at all and this year the COLA is expected to be about 0.2 percent. Therefore, the hold harmless provision may be triggered and leave about 30 percent of beneficiaries with a substantial increase in their Medicare Part B premium and deductible. That 30 percent would have to foot the bill for a premium increase that would normally be spread among all Medicare beneficiaries.
It is very possible, though not certain, that the increases will occur and we will know more next month, but NAHC is preparing for the worst. “We are deeply concerned by the projected Plan B premium and deductible increases, most notably for current and newly eligible beneficiaries living on low and fixed incomes," reads the letter to lawmakers.
“Newly enrolled Medicare beneficiaries, those not collecting Social Security benefits – many of whom are retired public servants – and state Medicaid programs should not be expected to carry the burden of paying for increased costs in Part B through higher premiums and cost sharing.”
The 30 percent affected are:
New Medicare beneficiaries;
Beneficiaries who have not started receiving Social Security;
Low-income beneficiaries who have their premiums paid by Medicaid;
High-income beneficiaries who pay higher premiums between 35 and 80 percent of program costs; and
Certain state and local employees who do not participate in Social Security.
The legislative fix required to remedy this situation is fairly simple, involving the modification of the 2017 safeguard put in last year’s budget deal to apply even with a COLA that is low, but not zero.
We will continue to monitor and advocate on this issue so stay tuned to NAHC Report for further developments.
The letter was embargoed, but leaked anyway and published elsewhere. NAHC is abiding by its promise not to publish the letter while it is under embargo. However, we will add the letter to this story as soon as the embargo is lifted.