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Health Reform and Medicare

What does health care reform mean for Medicare? It means protecting benefits, investing in Medicare to keep it strong for the future and lowering the cost of prescription drugs.


Here are five ways that health care reform will protect and improve Medicare:

  1. 1. Health care reform maintains and improves your Medicare benefits.

    • The nonpartisan Web site, FactCheck.org writes, "The claim that Obama and Congress are cutting seniors' Medicare benefits to pay for the health care overhaul is outright false, though that doesn't keep it from being repeated ad infinitum. The truth is that the pending House bill extracts $500 billion from projected Medicare spending over 10 years, as scored by the Congressional Budget Office, by doing such things as trimming projected increases in the program’s payments for medical services, not including physicians. Increases in other areas, such as payments to doctors, bring the net savings down to less than half that amount. But none of the predicted savings — or cuts, depending on one’s perspective — come from reducing current or future benefits for seniors." [FactCheck.org, 8/14/2009]
    • Health reform does not limit Medicare beneficiaries' access to their doctors — it increases it, says FamiliesUSA. None of the bills place any limits on access to doctors. Instead, access to doctors should improve under health reform because it will prevent a scheduled cut in payments to physicians. [Families USA, Setting the Record Straight on Medicare, 8/17/09]
    • The non-partisan CBO finds that Sen. Reid’s Patient Protection and Affordable Care Act would establish an Independent Medicare Advisory Board, which would be required, under certain circumstances, to recommend changes to the Medicare program to limit the rate of growth in that program’s spending. The provision would place a number of limitations on the actions available to the board, including a prohibition against modifying eligibility or benefits. [CBO Letter to Sen. Reid]
    • On Dec. 3, 2009, the Senate passed an amendment by a 100-0 vote that would “protect and improve guaranteed Medicare benefits.” As a result of the successful amendment now reads, “Nothing in the provisions of, or amendments made by, this Act shall result in a reduction of guaranteed benefits under title XVIII of the Social Security Act.” [Patient Protection and Affordable Care Act]

  2. 2. Reform would lower prescription drug costs.

    • Kaiser Health News reported that the Senate Health bill would lower out of pocket costs for seniors purchasing brand name drugs once they’ve reached the Medicare coverage gap. Kaiser wrote, “In 2010, this lapse in coverage will begin after an enrollee incurs $2,830 in total drug spending and end when an enrollee has spent a total of $4,550 out of pocket. After that, beneficiaries are responsible for just 5 percent of their drug costs. The Democrats' health-care overhaul bills in the House and the Senate could have a major impact on the Medicare prescription-drug program. The House bill would close the gap in coverage by 2019, although the Senate bill wouldn't. Under both bills, starting in 2010, beneficiaries would be able to buy brand-name drugs for half price once they're in the coverage gap. The annual enrollment period would also be moved up a month to start in mid-October.” [Kaiser Health News]
    • Kaiser Health News reported in August: “In a deal with the White House and the Senate Finance Committee, the drug industry has agreed to put up about $80 billion to help finance the expansion of health coverage... In the deal, the drug industry pledged to sell brand-name drugs for half price to senior citizens when they hit the gap or ‘donut hole’ in their Medicare Part D benefit. In the coverage gap, seniors have to pay the full cost of drugs on their own. The discount would start soon after the health overhaul bill is approved.” [Kaiser Health News, 8/11/09]
    • AARP states: “For people in Medicare, health care reform is about lowering prescription drug costs for people in the ‘donut hole,’ keeping the doctor of your choice, improving the quality of care and eliminating billions in waste that is causing poor care and medical errors.” [AARP, 8/18/2009]

  3. 3. Health care reform would invest in Medicare to keep it strong for the future.

    • In a Dec. 2, 2009 letter to all Senators, the National Committee to Preserve Social Security and Medicare expressed support for the Medicare provisions included in the Senate health reform bill, stating the bill will “extend the solvency of the Medicare Trust Funk by five years.” [NCPSSM Letter to the Senate]
    • The non-partisan Medicare Rights Center reports that, “HR 3962 brings down the rate of growth in Medicare spending and shores up Medicare’s Hospital Insurance Trust Fund, which is now predicted to run short of money to pay claims in 2017.” [Medicare Rights Center]
    • The Wall Street Journal reported that under the current system, the Medicare Trust Fund for hospital care would be depleted in 2017. [Wall Street Journal, 5/13/09]

  4. 4. Health care reform would prevent Medicare waste.

    • In their Nov. 18, 2009 analysis, the CBO agreed that the Sen. Reid’s Patient Protection and Affordable Care Act would reduce waste by “an additional $23 billion over the 2015–2019 period” through Independent Medicare Advisory Board, which would recommend changes to control the growth in spending and reduce waste. The CBO also stated that Congress could block any of the Commission’s recommendations before they went into effect. [CBO Letter to Sen. Reid]
    • Medical News Today reported that the Senate Health Care bill would cut costs by reducing fraud, waste and the duplication of tests. They wrote, “Similar to the House bill, the bill makes numerous changes to fraud and abuse laws, as well as enhances the authority of the HHS Inspector General. The bill includes new exclusion authority for obstructing an investigation or audit, new civil monetary penalties and exclusion from Medicaid or CHIP, if an entity owns, controls or manages an entity that is suspended, excluded or terminated from Medicaid or is affiliated with an individual or entity that has been suspended, excluded or terminated from Medicaid.” Medical News Today continued, “It establishes an Interagency Working Group on Health Care Quality to achieve collaboration among agencies, avoid duplication, and assess quality efforts. [Medical News Today]
    • AARP Bulletin Today writes, “It’s true [that reform proposals] all seek to save billions from Medicare costs — not by cutting benefits, ... [but by taking measures including] reducing waste and fraud.” [AARP Bulletin Today, 8/14/09]

  5. 5. Health care reform would reward quality treatment and enhance care.

    • According to the Medicare Rights Center, the Senate bill, “boosts Medicare payments for consultations with primary care doctors and specialists, and provides additional payments to doctors who coordinate care by different specialists and improve the health of their patients. A related bill would eliminate a 21 percent Medicare pay cut for doctors in 2010 and cuts in succeeding years that are mandated under the current payment formula.” [Medicare Rights Center]
    • The AARP Bulletin Today reported that, “all [reform proposals] seek to save billions from Medicare costs — not by cutting benefits, but by setting up new ways to pay doctors more fairly and to reward providers for quality of care instead of (as now) paying them a fee for each separate service; reducing waste and fraud; and reducing preventable hospital readmissions.” [AARP Bulletin Today, 8/14/09]
    • The Arizona Republic reported that in Arizona, the IBM-UnitedHealthcare program rewards doctors based on the quality of care rather than its quantity. The Republic reported that IBM decided to work with UnitedHealthcare on the program because they believed it would reduce costs in the long run. Dr. Paul Grundy, IBM's director of health care, said: “We are pretty unhappy with the care we buy. What we would really like to see is increased value. Hopefully costs will go down, but at the end of the day, we would like to get more value for the dollars we spend." [Arizona Republic, 7/31/2009]

To learn more about the legislative proposals being discussed in Washington, click here.

To contact your member of Congress and take action in support of health reform, click here.