Senate Democrats

Republican Plan To Shutdown Medicare Will Raise Seniors’ Premiums And Cut Benefits For More Than 20 Million Americans

Democrats want to cut federal spending and require government to live within its means, and favor a responsible approach to reducing the deficit that will strengthen our economy. The new Republican budget reflects upside-down priorities – it protects special interest subsidies and tax breaks for those at the top, and cuts deep into the heart of the programs that are essential to the health of our seniors. The Republican budget ends Medicare as we know it – converting it into a voucher-type program. While providing a windfall for the health insurance industry, it would force seniors to pay much more for health care. If Republicans get their way, premiums for more than 20 million seniors will skyrocket and they will all lose their guaranteed health benefits. Democrats are committed to protecting Medicare benefits for all, and are focused on cutting waste, fraud and abuse in Medicare without hurting seniors.

20 Million Near-Elderly Will Not Have Medicare When They Retire. Starting in 2022, Medicare will be eliminated for new beneficiaries and converted instead into a voucher program. There are more than 20 million near-elderly Americans who are now ages 50-54 who would not get Medicare when they retire but instead only get a coupon to purchase private health insurance. This approach would transfer control of Medicare to insurers and there would be no guaranteed benefits, essentially ending Medicare. Moreover, the voucher will fail to keep pace with increases in the cost of health care so its value will decline every year, meaning that future seniors won’t be able to get the benefits they need or even end up uninsured. [CBPP, 4/7/2011; Census 2010 data]

CBO: Voucher Proposal Will Double Health Care Costs for Seniors. The voucher will fail to keep pace with increases in the cost of health care. As a result, seniors will be forced to pay higher premiums in order to access the same benefits they would receive under the current system. According to the CBO, a typical senior will spend more than twice as much of his or her own income on health services under the Ryan proposal as compared to the current Medicare system. [CBO, 4/5/11]

Under the Republican Plan, Seniors Will Lose Guaranteed Benefits. Under current law, all seniors have guaranteed access to life-saving health benefits, including screenings for colon cancer, diabetes, and prostate cancer, as well as flu shots. If the Republican plan becomes law, seniors that were eligible for guaranteed health benefits last year could lose their benefits. [Kaiser State Health Facts, accessed on 3/39/11]

Republican Proposal Could Force Seniors to Pay $44 Billion More for Prescription Drugs. The Republican proposal would “reopen” the prescription drug donut hole and cost the average senior who falls into the donut hole approximately $11,794 between 2012 and 2020. Over that time, Ryan’s budget will cost seniors an estimated $44 billion in prescription drug costs, including $2.2 billion next year alone. In 2010, approximately 3.7 million seniors fell into the “Donut Hole.” [HHS, 11/4/10]

CBO: Ryan Plan Means “Most Elderly People Would Pay More For Their Health Care.” In their initial analysis of the Ryan Medicare plan, the non-partisan Congressional Budget Office determined, “Under the proposal, most elderly people would pay more for their health care than they would pay under the current Medicare system… Under the proposal, the gradually increasing number of Medicare beneficiaries participating in the new premium support program would bear a much larger share of their health care costs than they would under the traditional program…That greater burden would require them to reduce their use of health care services, spend less on other goods and services, or save more in advance of retirement than they would under current law.” [CBO, 4/5/11]