President’s Budget Aims To Create New Income Brackets for Medicare
President Obama's plan to raise Medicare premiums for higher-income beneficiaries would create five new income brackets that would generate more revenue for the federal government, according to new budget details released by the White House on Friday, the AP/Miami Herald reports.
Obama's fiscal year 2014 budget proposal -- released last week -- would raise $50 billion over a decade by increasing beneficiaries' monthly "income-related" premiums for outpatient and prescription drug coverage.
Details of Medicare Proposal
The latest details released by the administration show that beginning in 2017 the number of income brackets that qualify for higher premiums would increase from four to nine.
The plan would raise beneficiaries' Medicare premiums and also freeze adjustments for inflation until one in four beneficiaries were paying the higher amounts. Currently, only about one in 20 beneficiaries pay the higher premiums.
For example, under the proposal, a beneficiary with an annual income of $85,000 would pay about $168 monthly for outpatient coverage, compared with about $147 currently.
Meanwhile, the highest income bracket -- which currently is set to those with annual incomes exceeding $214,000 -- would be lowered to $196,000. Further, individuals in the top income bracket would be responsible for 90% of the coverage cost, compared with 80% currently.
HHS Secretary Kathleen Sebelius on Friday said the Medicare proposals included in Obama's budget are intended to strike a balance between cutting health care spending to reduce the deficit and maintaining services for those who depend on them (Alonso-Zaldivar, AP/Miami Herald, 4/12).
Democrats To Send Letter Vowing To Vote Against Proposed Entitlement Cuts
In related news, Reps. Alan Grayson (D) and Mark Takano (D) plan to send Obama a letter vowing to vote against any cuts in entitlement spending, the Washington Times reports.
The letter -- which also is signed by other Democrats -- states, "We will vote against any and every cut to Medicare, Medicaid or Social Security benefits -- including raising the retirement age or cutting the cost-of-living adjustments that our constituents earned and need" (Chumley, Washington Times, 4/15).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.