Seniors could pay significantly higher Medicare costs under proposals that Congress is expected to consider in coming months.  The Medicare Trustees recently announced a "Medicare Funding Warning". Under Medicare Funding Warning rules, the President is required by law to submit to Congress proposed legislation to cut Medicare costs or increase revenues (which include the premiums beneficiaries must pay).  Congress then is required to consider this legislation on an expedited basis.  

TSCL expects the proposals to include some hefty cost increases for Medicare beneficiaries.  In his fiscal year 2008 budget, President Bush proposed an expansion of Means Testing to include Part D, and eliminating the annual income adjustment so that increasing numbers of middle-income seniors would pay higher Medicare premiums in the future.

In addition, the Congressional Budget Office also sent Congress a number of options to cut Medicare costs.  Topping the list is a proposal to increase the portion of the Part B premium that all beneficiaries pay from 25% to 30% of the cost.  The government currently pays 75% for beneficiaries with incomes less than $80,000.  If beneficiaries were to pay 30% in 2007 the Medicare Part B monthly premium would be $112.20 instead of $93.50 — or $224.40 more this year.

During the recent budget process, both the House and Senate rejected Means Testing proposals, but TSCL remains concerned legislation could be introduced again.

TSCL is fighting Means Testing and other proposals that would make seniors pay higher Medicare costs.

Sources:  2006 Medicare Trustees Report, May 1, 2006.  "An Analysis Of The President's Budgetary Proposals For Fiscal Year 2008," Congressional Budget Office, March 2007.

June 2007