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Fact Sheet: The GOP Budget Hurts Seniors

Apr 7, 2014


The Republican Budget Ends the Medicare Guarantee – Everyone entering Medicare in 2024 or later will get a voucher to help pay premiums for either a private health plan or traditional Medicare. Under this plan, average premiums for traditional Medicare will be 50 percent higher than current law. Private plans in Medicare already "cherry pick" healthy enrollees, and this tendency will get worse under the Republican plan. Sick and frail seniors tend to prefer traditional Medicare, but under the plan, they will face skyrocketing costs that will destabilize the program. The budget claims long-term savings by assuming that per-beneficiary spending grows at a capped rate, below the expected growth rate in health care costs. But the only way to ensure those savings is to break the guarantee that a senior's Medicare benefit will keep pace with costs over time. If health costs grow at the expected rate, future beneficiaries would have to pay thousands of dollars more out of their own pockets.

The Republican Budget Increases Seniors' Health Costs – The budget repeals the Affordable Care Act Medicare benefit improvements. This means the budget increases seniors' prescription drug costs by re-opening the Medicare coverage gap, making seniors with high drug costs pay an average of nearly $1,200 more per year for their drugs through 2022. It also means seniors will pay more for crucial preventive health services that they can now get with no cost sharing under the Affordable Care Act.

The Republican Budget Continues Cuts to Medicare Providers The Republican budget maintains $140 billion in across-the-board sequester cuts to Medicare service providers.

Raises Medicare Eligibility Age – The budget increases the eligibility age for Medicare starting in 2024, letting it rise to age 67, but repeals the Affordable Care Act, so that there would be no affordable coverage options for seniors without employer-sponsored coverage.

The Republican Budget Slashes Medicaid Funding The Republican budget cuts $732 billion from the base Medicaid program (in addition to repealing the Affordable Care Act expansion) and abdicates federal responsibility for the seniors the program serves. The cut is 10 percent of projected spending in 2016, rising to more than 25 percent in 2024. One in five Medicare beneficiaries gets help from Medicaid for out-of-pocket expenses or long-term care costs. Senior citizens and persons with disabilities would be at particular risk under the Republican's plan because they account for two-thirds of the spending in this base Medicaid program.