• Increase the beneficiary share of Medicare Part B premiums to 30%.  Premiums would increase to $78.10 per month instead of the estimated $66 per month (see cover story “Medicare Premiums Estimated to Increase 12.4% for 2004”).
  
  
• Index Medicare Part B deductible.  The Medicare Part B deductible is now $100 and has only been raised three times since the program began in 1966.  Indexing would mean it would increase annually.
  
  
• Limit the Medicare portion of cost sharing amounts.  The proposal would combine the Part A hospital insurance deductible with Part B for a single annual deductible of $600 per year.  This would significantly raise deductible costs for the 77% of seniors who are not hospitalized in a given year.
  
  
• Restrict the amount of deductibles and co-insurance that Medigap plans are allowed to cover. Medigap plans would be barred from covering the first $600 of a beneficiary’s costs, and would limit coverage of the next $2,800 to 50% of costs.
  
  
• Impose a new copayment for home health care.  Currently there are no co-payments for home health care.  Beneficiaries would be charged 10% of the total cost of each 60-day period of service.

For six consecutive years, Congress has attempted and failed to pass a Medicare prescription drug benefit.  On the other hand, Congress dramatically increased funding to doctors, hospitals, and other health care providers.  To increase all seniors’ costs to cover a new prescription drug benefit would offset the positive effects of a new benefit and raise program costs even more, even for seniors who already have prescription drug coverage.  It’s vital to let your Members of Congress know that drastically increasing Medicare costs for beneficiaries is NOT the answer to paying for a prescription drug benefit.

Source:  Budget Options, The Congressional Budget Office, March 2003.

July 2003