LETTER I REC'D TODAY FROM SEN. DAN COATS ON MEDICARE PART B PREMIUM SPIKE

LETTER I RECIEVED TODAY FROM SEN. DAN COATS ON MEDICARE PART B PREMIUM SPIKE

Posted on October 26, 2015 by kidneystories

LETTER I RECIEVED TODAY ON MEDICARE PART B PREMIUM SPIKE FROM SEN. DAN COATS

Dear James:

Thank you for contacting me regarding premium increases in 2016 for Medicare Part B and the Cost of Living Adjustment (COLA) for Social Security beneficiaries.  I appreciate the opportunity to respond.

Medicare is the federal health insurance program for most individuals who are sixty-five and older and for certain disabled persons. Medicare Part B provides coverage for physicians’ services, outpatient services, durable medical equipment, and other services.  Part B is financed through a combination of beneficiary premiums and federal revenue.

Many Medicare Part B beneficiaries also receive Social Security benefits.  Contrary to popular belief, Congress does not determine annual Social Security COLAs.  Social Security COLAs are determined by an economic formula that measures the increase or decrease in the price of goods in the American economy.  This formula, the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), is the sole determining factor of a COLA for Social Security recipients.  In 2015, Social Security beneficiaries received a 1.7 percent COLA.  However, in 2016 there will be no COLA because the CPI-W decreased.

By law, Medicare Part B premiums, which are deducted automatically from Social Security checks for those who receive Social Security, must cover 25 percent of the projected annual Part B costs.  The Social Security Act (SSA) includes a “hold harmless” provision that prevents premium increases should the amount be higher than their Social Security monthly benefit.  While this hold harmless provision will prevent Part B increases for about 70 percent of beneficiaries, 30 percent of beneficiaries who are not covered by it must pay the portion that otherwise would have been spread across all beneficiaries.

Each year, the Centers for Medicare and Medicaid Services (CMS) determines the Medicare Part B premiums for the following year.  Reports that some beneficiaries will face a steep 2016 premium increase are based on a July 2015 Medicare Trustees report.  The Trustees documented an unexpected increase in Part B spending that they estimate would cause premiums to rise.  Since there will be no Social Security COLA increase in 2016, the Trustees estimated that the projected standard Medicare Part B premium is expected to increase from $104.90 to $159.30 in 2016 for those not protected under the hold harmless provision.  Individuals not protected and thus subject to the increase are: those covered under both Medicare and Medicaid (“dual eligibles”); high income earners already subject to higher premiums; new beneficiaries; and those not collecting Social Security benefits.  The law does provide CMS with some discretion in setting premiums, though CMS has not officially announced the 2016 premium amount at this time.

I understand that steep increases in Part B premiums will place a significant burden on those Hoosiers who are not protected by the hold harmless provision.  As a member of the Senate Finance Committee, I am closely monitoring the actions of CMS and I am actively engaged in examining responsible options to fix this imminent problem and to address long-term solutions to preserve benefits for current and future beneficiaries.

Thank you again for contacting me, and please do not hesitate to keep in touch on other matters of concern to you.

Sincerely,

Dan Coats
United States Senator

To learn more about the work I’m doing on behalf of Hoosiers, sign up for my newsletter, visit my website, and follow me on Twitter and Facebook.

My reply:

Senator Coats:

Thank you for your reply of 10/26/2015.  I appreciate your thoughtfulness.  I am curious what your position is on co-sponsoring, supporting and voting for the fix for this problem, S. 2148?  Thank you again for such a prompt reply to my initial inquiry.  I hope to see you in Washington, DC in March as part of the celebration for World Kidney Day. 

Your friend and fellow Hoosier,

James W. Myers, III

Kidney Advocate

LINK TO PETITION TO FIX THIS PROBLEM

https://www.change.org/p/u-s-congress-congress-act-now-to-prevent-a-drastic-spike-in-medicare-part-b-costs-to-esrd-patients

PETITION PROTESTING SUBSTNTIAL INCREASE IN MEDICARE PART B PREMIUMS AND LETTER FROM SENATOR JOE DONNELLY

https://www.change.org/p/u-s-congress-congress-act-now-to-prevent-a-drastic-spike-in-medicare-part-b-costs-to-esrd-patients

LETTER I REC'D FROM SENATOR JOE DONNELLY TODAY

October 20, 2015

Dear Mr. Myers,

Thank you for taking the time to contact me with your concerns about potential Medicare Part B premium increases for certain beneficiaries. Like you, I believe seniors on a fixed income should not be faced with unreasonable premium increases. Most seniors enrolled in Medicare Part B are expected to pay a monthly premium, which covers about 25 percent of the cost of the services provided under that section. Monthly Part B premiums—which help pay for physician services, outpatient care, and durable medical equipment—are automatically deducted from beneficiaries' monthly Social Security payments. In years that monthly Social Security benefits are not increased, some seniors may face an increase in Part B premiums to make up for the growing cost of health care services. Most beneficiaries are protected by a "hold harmless" rule, which prevents increases in Part B premiums that exceed the dollar amount of the increase in their Social Security checks. The hold harmless rule protects approximately 70 percent of Part B participants, meaning their Social Security payments are not impacted. However, the remaining 30 percent of beneficiaries could shoulder the entire beneficiary share of the increase in Part B costs. This means some Part B beneficiaries could see their monthly premium increase by $50 or more. In addition, the Part B deductible for all beneficiaries will increase from $147 to $223. The beneficiaries who are not protected by the hold harmless rule include:

•Low-income beneficiaries whose Part B premiums are paid by the Medicaid program;

•High-income beneficiaries who are subject to income-related Part B premiums;

•Those whose Medicare premiums are not deducted from Social Security benefits; and

•New enrollees in 2016

To address this issue, S. 2148, the Protecting Medicare Beneficiaries Act, was introduced on October 7, 2015. If enacted into law, this legislation would prevent premium increases for 15 million beneficiaries and reduce the Part B deductible for all Medicare beneficiaries. The Protecting Medicare Beneficiaries Act is pending before the Senate Committee on Finance. Should this legislation come before the Senate for a vote, I will be sure to keep your thoughts in mind. It is a privilege to represent you and all Hoosiers in the Senate. Your continued correspondence is welcome and helps me to better represent our state. I encourage you to write, call, or email if my office can ever be of assistance. You can also check out my Facebook page and follow me on Twitter by visiting my

website.

Sincerely,

Joe Donnelly

U.S. Senator