The budget passed by House Republicans in April 2011 makes radical changes to Medicare. The Republican plan raises costs for seniors and individuals with disabilities enrolled in Medicare, reduces their benefits, and puts private insurance companies in charge of the program. For current beneficiaries, important benefits – such as closing the hole in Medicare’s drug coverage – would be immediately eliminated. For individuals age 54 and under, Medicare’s guarantee of comprehensive coverage would be replaced with a “voucher” or “premium support” to buy private health insurance. By design, this federal contribution does not keep pace with medical costs, shifting thousands of dollars in costs onto the individual.
This analysis shows the immediate and long-term impacts of these changes in the 5th Congressional District in Washington, which is represented by Rep. Cathy McMorris Rodgers.
The Republican proposal would have adverse impacts on seniors and disabled individuals in the district who are currently enrolled in Medicare. It would:
• Increase prescription drug costs for 7,100 Medicare beneficiaries in the district who enter the Part D donut hole, forcing them to pay an extra $70 million for drugs over the next decade.
• Eliminate new preventive care benefits for 117,000 Medicare beneficiaries in the district. The Republican proposal would have even greater impacts on individuals in the district age 54 and
younger who are not currently enrolled in Medicare. It would:
• Deny 530,000 individuals age 54 and younger in the district access to Medicare’s guaranteed benefits.
• Increase the out-of-pocket costs of health coverage by over $6,000 per year in 2022 and by almost $12,000 per year in 2032 for the 110,000 individuals in the district who are between the ages of 44 and 54.
• Require the 110,000 individuals in the district between the ages of 44 and 54 to save an additional $25.7 billion for their retirement – an average of $182,000 to $287,000 per individual – to pay for the increased cost of health coverage over their lifetimes. Younger residents of the district will have to save even higher amounts to cover their additional medical costs.
• Raise the Medicare eligibility age by at least one year to age 66 or more for 58,000 individuals in the district who are age 44 to 49 and by two years to age 67 for 418,000 individuals in the district who are age 43 or younger.
Data sources: Data on Medicare enrollment and the number of seniors in the Part D donut hole was obtained from the Centers for Medicare and Medicaid Services. Data on the age distribution of district residents was obtained from the U.S. Census. Data on increased costs for Medicare enrollees under the Republican plan was obtained from the Congressional Budget Office and the Medicare Actuary and the Center for Economic and Policy Research. Data on increased savings needed to pay for health care costs under the Republican budget was obtained from the Center for Economic and Policy Research (CEPR and are based on CEPR analysis of CBO data
From Impacts of the Republican Medicare Plan In Washington’s 5th Congressional District Committee on Energy and Commerce, Democratic Staff