Wyden, Senate Democrats Introduce Measure to Prevent Spike in Medicare Premiums

Medicare Part B Premiums and Deductibles Set for Dramatic Rise Next Year Without Congressional Action

Bill Would Keep Premiums and Deductibles Affordable for Millions of Seniors

WASHINGTON –Senate Finance Committee Ranking Member Ron Wyden, D-Ore., and Senate Democrats today introduced legislation that would protect Medicare beneficiaries and states from a sharp rise in Part B premiums and deductibles in 2016. Wyden’s bill, the “Protecting Medicare Beneficiaries Act of 2015,” ensures that Medicare premiums and deductibles will not increase in 2016.

“Today’s fix will protect over 370,000 Oregonians and millions of seniors across the country from an abrupt and dramatic increase in Medicare costs,” Wyden said. “It is urgent that Congress take decisive action to ensure vulnerable Americans aren’t harmed by this archaic policy.”

In the coming days, 2016 premiums and deductibles for Medicare Part B as well as the Cost-Of-Living Adjustment (COLA) for Social Security will be announced. Due to a projected 0% COLA, roughly 30% of Medicare beneficiaries, 15 million Americans, will face an unexpected 52% increase in monthly premiums because they are excluded from the rarely-used “hold-harmless” policy.

Wyden’s bill will hold 2016 premiums constant for the 30% group at the 2015 level ($104.90) and maintain the deductible for all beneficiaries at $147 (the 2015 threshold).

Bill text can be found here.

Co-sponsors include Sens. Bennet, Brown, Cardin, Casey, Menendez, Murray, Nelson, Schumer, Stabenow, Sanders, Baldwin, Leahy, Carper, Udall, Hirono, King, Mikulski, Coons, Franken and Merkley.

Background

Medicare has a “hold-harmless” provision that, for about 70 percent of beneficiaries, ensures the dollar increase in the Part B premium cannot be more than the dollar increase of a beneficiary’s monthly Social Security benefit. This is to ensure that beneficiaries will not have a reduction in their monthly Social Security benefit.

Certain beneficiary groups (about 30% of total beneficiaries) are statutorily excluded from the “hold-harmless” provision. Dual-eligibles, who are eligible for Medicare and Medicaid, make up two-thirds of this excluded group. State Medicaid programs are financially responsible for the entire increase for these individuals. Due to the increase, states may face budgetary challenges and forego other needed Medicaid services to pay the additional premiums.

Other groups not included in the “hold-harmless” provision include new beneficiaries, high-income beneficiaries, and Medicare beneficiaries who do not receive Social Security.

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