U.S. Senator Tammy Baldwin Joins Effort 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 – U.S. Senator Tammy Baldwin has joined Senate Finance Committee Ranking Member Ron Wyden and Senate Democrats in introducing legislation that would protect Medicare beneficiaries and states from a sharp rise in Part B premiums and deductibles in 2016. The Protecting Medicare Beneficiaries Act of 2015 ensures that Medicare premiums and deductibles will not increase in 2016.

“This commonsense measure will protect over 630,000 Wisconsinites and millions of seniors across the country from an abrupt and dramatic increase in Medicare costs,” said Senator Baldwin. “I urge my colleagues to act quickly in order to ensure vulnerable Americans aren’t left behind by this harmful policy.”

Last week, it was announced that for the first time in five years, there will be no annual Cost-Of-Living Adjustment (COLA) for Social Security in 2016. Because of this, 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.

The Protecting Medicare Beneficiaries Act of 2015 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, 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.