Obama's Medicare plan scrutinized

Concern is that costs actually will be shifted to mid-income earners
2013-04-29T00:00:00Z Obama's Medicare plan scrutinizedWilliam E. Gibson Mcclatchy Newspapers Arizona Daily Star
April 29, 2013 12:00 am  • 

WASHINGTON - Should well-to-do senior citizens in Florida and across the country pay more for Medicare?

With little fanfare, that's been happening since 2007.

Single recipients who make more than $85,000 and couples who make more than $170,000 a year now pay $146.90 a month - $42 more than the basic premium for doctor care.

Those at the highest range - singles making more than $214,000 and couples making more than $428,000 - are paying $335.70 a month.

Something similar is true for Part D, which covers prescription drugs. Higher-income patients are paying an extra cost ranging from $11.60 to $66.60 a month.

Today, only 5 percent of Medicare recipients pay that surcharge for doctor care and 3 percent for drug coverage. But President Obama and many in Congress are proposing to expand that number - to one of every four of those covered, by 2035.

The president's budget plan would accomplish that by adding more income brackets and then freezing them so they don't rise with inflation.

If approved by Congress - and it's not clear if or when that might happen - that would gradually squeeze more and more middle-class households as their incomes rise, health-care analysts said last week.

"They are saying this hits wealthier people. We think that it's really reaching down into the middle class and some people who can't really afford to pay higher premiums, given all their other out-of-pocket health-care costs," said Diane Lifsey, senior legislative representative for the National Committee to Preserve Social Security and Medicare.

Obama is proposing other charges as well, regardless of income.

Patients who receive home health care would face $100 co-payments for every 60-day period of service unless they came from a hospital.

New Medicare enrollees would pay an additional $25-per-year deductible for Part B, which covers doctor care, in 2017 and again in 2019 and 2021.

And those who hold many Medigap insurance policies, which cover costs not paid by Medicare, would face a surcharge of roughly $35 a month.

These plans reflect attempts by Obama and Congress to rein in spending on "entitlement" programs that eat up nearly 40 percent of the federal budget.

Obama is proposing to make higher-income patients pay more - known as "means testing" - as part of a compromise with Republicans..

His $3.8 trillion budget for next fiscal year also calls for trimming Social Security cost-of-living raises by changing the way inflation is figured.

Administration officials say their proposals would spare those who can least afford higher costs. They also say home-care co-payments and a Medigap surcharge would discourage people from tapping expensive care they don't really need.

The Affordable Care Act already has frozen income thresholds until 2019, so more people will be subject to higher premiums as their incomes rise.

The latest Obama proposal would create nine income brackets in place of the current four, which start at $85,000 a year for individuals and $170,000 for couples. The new thresholds would remain frozen until one-fourth of Medicare recipients pay a higher rate based on their income.

A 2012 Kaiser Family Foundation study also found that:

• Under current law, a single patient with an income of $86,000 in 2017 would pay $186 a month for Part B. Under the Obama plan, he or she would pay $214, an extra $28. His or her Part D premium would increase by $9 a month.

• An individual who makes $110,000 in 2017 would pay about $355 a month for Parts B and D. Under the Obama plan, he or she would pay $408 - an extra $53.

• A married couple enrolled in Parts B and D making $175,000 in 2017 would pay $496 under current law and $571 under the Obama plan - an extra $75.

The plan, like others, is subject to change as Congress struggles to reduce the deficit without sparking a backlash from senior citizens and other voters.

Copyright 2014 Arizona Daily Star. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Follow the Arizona Daily Star

Featured businesses

View more...

Deals, offers & events

View more...

The hearing of a dog is more sensitive than humans.

Dogs can hear much higher frequencies, which is why they respo…