Experts tell lawmakers: Obama Medicare proposals would hurt long-term care — or maybe not

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Experts disagreed on how proposed Medicare cost-sharing increases would affect seniors.
Experts disagreed on how proposed Medicare cost-sharing increases would affect seniors.
U.S. lawmakers heard mixed messages at a hearing Tuesday on how proposed Medicare cost-sharing reforms would impact long-term care. The House Ways and Means Subcommittee on Health focused in particular on three measures in the White House's proposed 2014 budget. 

They include: a higher Medicare Part B deductible, new home health copayments, and an expanded pool of beneficiaries subject to income-related Part B and Part D premiums.

Most beneficiaries have low, fixed incomes and significant health needs, with nearly one in four requiring “extensive, ongoing care,” Medicare Rights Center President Joe Baker said in his written testimony. Therefore, he argued, additional cost-sharing would be extremely burdensome for seniors using Medicare.

“Most people with Medicare lack coverage for most long-term care services and supports, such as ongoing nursing home care or long-term home health services,” Baker stated. “And most people with Medicare would be unable to afford or would have their life savings depleted by the average annual cost of a private nursing home room — about $84,000 per year.”

Increasing Part B deductibles could make necessary care, including rehabilitation, unaffordable for low-income seniors, Baker said. He also blasted the increased home health copayment, saying it could lead to unnecessary nursing home admissions.

The subcommittee got a different take from Alice M. Rivlin, Ph.D., a senior fellow in economic studies at The Brookings Institution. While she advocated for a broad restructuring of Medicare as laid out in a report she co-authored, she suggested that cost-sharing for skilled nursing and home care should be on the table.

“Some Medicare-covered services, such as home health, laboratory services, and the first 20 days of a skilled nursing facility stay, have no cost-sharing at all,” she stated in her written testimony. “Private health insurance usually includes some kind of cost-sharing for these services. Just as unrealistically high cost-sharing is counterproductive, the total absence of cost-sharing for some services encourages inappropriate utilization and can help fraud remain undetected.”

The other witness to speak was Joseph Antos, the Wilson H. Taylor Scholar in Health Care and Retirement Policy at the American Enterprise Institute. He came out in support of the White House cost-sharing proposals, saying they are a good starting point to develop bipartisan legislation to slow Medicare spending.

Click here to view the hearing.



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