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Medicare Questions

Q: I’ve heard people say that this plan “ends” Medicare. Is that true?

A: No.  This budget protects and strengthens Medicare. The non-partisan Congressional Budget Office says that without reforms, Medicare will go bankrupt just as current seniors are in the heart of their retirements. Our plan contains bipartisan solutions to strengthen Medicare by offering guaranteed-coverage options to future seniors, regardless of pre-existing conditions or health history.

Q: You’ve put forward your solution. How would others solve this problem?

A: The President’s health-care law makes drastic changes to Medicare, but those changes make matters worse. The President’s health-care overhaul created an unaccountable board of 15 unelected bureaucrats to cut Medicare in ways that would deny care to current seniors.

See here for a complete contrast between the President’s approach and our approach when it comes to Medicare.

Q: Didn’t the President’s health-care law improve Medicare’s solvency?

A: No. The President’s health-care law raided Medicare to fund an open-ended health-care entitlement. Advocates of the President’s health-care law claimed that the law both improved Medicare’s solvency and paid for the new entitlement at the same time. This claim is contradictory. Medicare’s chief actuary testified before the House Budget Committee that the Medicare savings had been double-counted.

The House Republican budget stops the raid on Medicare and ensures that any current-law Medicare savings are devoted to saving Medicare. It is crucial that policymakers ensure Medicare’s solvency into the next decade if we want to protect the current arrangements of those in or near retirement.

Q: What does your budget do to address the 2023 insolvency of the Medicare Hospital Insurance (Part A) trust fund?

A: The House Republican budget produces near-term savings over the next ten years by proposing curbs on abusive and frivolous lawsuits. Medical lawsuits and excessive verdicts increase health-care costs and result in reduced access to care. When mistakes happen, patients have a right to fair representation and fair compensation. But the current tort-litigation system too often serves the interests of lawyers while driving up costs.

This budget also advances a bipartisan proposal to further means-test premiums in Medicare Parts B and D for high-income seniors, similar to the President’s proposal in his fiscal year 2013 budget. This reform does not go into effect until 2020. These common-sense reforms to subsidize the wealthy less will not cause disruptions to seniors’ current arrangements. 

Q: Will I lose my guaranteed health care through Medicare, and instead have to rely on a voucher?

A: No. The changes in the House Republican budget will not affect those in or near retirement in any way. When younger workers become eligible for the Medicare program, they will be able to choose the kind of coverage that best suits their needs from a list of plans—including traditional Medicare. These plans will be guaranteed to offer coverage to all beneficiaries regardless of pre-existing conditions. Medicare would then provide a payment to subsidize the cost of the plan. This is not a voucher. It is a payment that goes to whatever plan recipients choose. The program would operate in a similar manner as the health insurance that Members of Congress receive and Medicare’s prescription drug benefit program, which are also not “vouchers.” Former Clinton Budget Director Alice Rivlin has made it clear that premium support would not be vouchers with the following statement in testimony before the House Ways and Means Committee: “premium support as we define it is definitely not a voucher.”

Q: Does this budget reinstate the so-called Medicare “donut hole”?

A: This budget repeals the Democrats’ health-care law, including provisions that increase prescription-drug prices for everyone. In fact, the CBO confirmed that the law’s new requirements will drive up health-care costs, at odds with claims made by its proponents. In a letter to Chairman Ryan last fall, CBO stated that “[the] increase in prices would make federal costs for Medicare’s drug benefit and the costs faced by some beneficiaries higher than they would be in the absence of those provisions,” and that “the premiums of drug plans will increase along with the increase in net drug prices, so the premiums paid by beneficiaries will increase slightly.” Like the rest of this costly new entitlement, provisions that increase prescription-drug prices should be repealed.

The real threat to seniors’ health care is the fact that Medicare is going bankrupt. The current trajectory of government spending on health care is unsustainable. As noted above, without changes, according to CBO, the Medicare program collapses in 2023. Comparing any plan to save Medicare with the status quo means comparing real solutions to a false reality. This budget protects Medicare for current seniors by averting any disruptions and saves the program for future generations by providing a personalized Medicare program—like the one members of Congress now enjoy—with more support for low-income beneficiaries and those with higher health costs and reduced subsidies for high-income beneficiaries.

Q: What about the Medicare “Doc Fix” that our nation’s physicians have been promised will be implemented so they can continue serving seniors?

A: The House Republican budget recommends a ten-year “Doc Fix” in the form of a deficit-neutral reserve fund. Washington must stop spending money it doesn’t have, and this proposal will ensure Medicare physicians do not experience sharp reductions in their reimbursement rates—protecting seniors’ access to critical care—without adding to the nation’s debt.

Q: Will your proposed changes affect those older than 55 in the years ahead?

A: Our budget ensures no changes for those in or near retirement. The reforms begin in the year 2024, which today means no changes for those 55 and above.  It is critical that we come together now with a real solution to protect and strengthen Medicare. Remember: Obamacare broke the Medicare promise for seniors. It cuts benefits for current seniors and ensures a bankrupt program for the next generation.