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Higher Medicare Costs Or Less Benefits | The Fiscal Cliff

Debt Super Committee failure may mean a 2% cut to MedicarePlan A Plan B Written on Board

News reporters and media types are giddy. The members of the Debt Super Committee tasked with finding 1.2 Trillion in budget cuts were wringing their hand trying to figure out how to announce their failure.

But for real people on Medicare this means a mandatory reduction in Medicare of 2%… or does it?

No problem… just kick the can down the road. Now the new media buzz term… The Fiscal Cliff!

Now we’re back where we started We’ve read that story before!

Going to Plan B by default: Medicare cuts of 2%

Let’s assume that Medicare is to get cut by 2%. What does that mean to you? It more than likely means higher premiums, deductibles and out of pocket costs or a reduction in benefits.

Another scenario would be to further reduce payment to Medicare providers. But given recent reductions and strong lobbying efforts, don’t expect providers to roll over and play dead. In fact you would probably see a mass exodus of providers who currently accept Medicare assignment.

So that leaves you… the beneficiary.

The more likely scenario would be increased costs. It’s unlikely that benefits would be taken away. In fact new benefits such as the expansion of coverage to reduce cardiovascular disease are being added even during this time of debate.

How will cuts effect the type of plan you have?

Original Medicare

If you are enrolled in original Medicare you could see higher premiums and deductibles or higher copays (beyond 20%) when you require service.

Part D

A logical step to control Part D costs would be to raise the annual deductible. At $320 per month for some plans this is already a hardship.

Medicare Advantage

Currently there is regulation in place limiting¬† a plan’s provider the ability to raise premiums beyond a certain level. Expect higher out-of-pocket costs and watered down benefits.

Medigap

Premiums that were once affordable may not be in the future. If costs go up so will the premiums for Medigap policies. There is already a proposal to slip a large deductible into Medigap policies to discourage use.

What do you think? Would you sacrifice benefits to keep the cost at today’s levels? Or would you rather keep your benefits and accept that they will cost a little more?

Leave a comment below for your voice to be heard.


22 comments

  1. Our representatives in Washington, D.C. could care less about the common citizen. They have theirs already and in most cases are set for life, along with their family members. It’s a shame how these losers act when they’re supposed to be looking out for our best interests. Both parties are to blame along with the White House bozos. I’m a registered Republican, but right now I’m not real happy with either party. Term limits and eliminating the benefits for life that they enjoy is one way to turn this thing around.

  2. Our government representatives should be required to go thru the alphabet soup of selecting a plan and then reading the details. I beleive this simple step would improve the health care programs. Given this is likely not to happen, increased deductables and larger copays are occuring now and will no doubt continue. Unfortunately one must be able to predict the future to truly select the best plan. Thus neither option is a winner. We actually need universal coverage, but it is only the nations with better healthcare for the buck that do it and congress sees those countries as “socialist”

  3. I’d much rather see a reduction in benefits. That way those of us who prefer to make lifestyle changes to maintain health and use alternative or complementary modalities not covered by insurance will not be forced to pay more for services we don’t use other than for extreme situation.

    I am almost 75 and do not take any medications on an ongoing basis. I will take an antibiotic if absolutely necessary but avoid drugs when at all possible.

    In my opinion, most seniors are over doctorered and most especially over medicated and shifting some of the cost from the government to those over using our so called health care system would encourage them to think twice about what they are doing and perhaps make healthier choices.

  4. I’d prefer the increase in premiums over a reduction in benefits. The higher premiums will be fixed for year. A known amount and something I can budget and plan for.

    Reduced benefits are more of a gamble. It depends on which benefit I might need and that depends on what malady comes my way.

  5. I would rather see the United States Government keep its promises to its own Citizens.
    Why does the ‘media’ now call Federal promises, ‘entitlements’?

  6. Attempts by Congress or the Senate to pass bills that they claim will decrease the unsustainable levels of debt being generated is a pathetic effort on their part to solve the problem at hand. It is just re-arranging the deck chairs on the Titanic.The elected people on the hill know what has to be done to avert national decline . That is:1.Revise the tort laws that are one of the primary drivers in the cost of medical care.2.Curb the lobbyists and special interest groups that keep the fat cats on the hill in office. 3.Elected officials at all levels should not have better health and pension programs than the electorate.4.Revise the Tax Code. If the can accomplish this it will restore our national vitality.

  7. It is a “no win” situation; no matter how you look at it; we lose. The question is redundant. What we really need is to start over with Government and that means: new people, new ideas; THE RICH GET RICHER AND THE POOR GET POORER; whatever happened to being proud to be an American? When government cannot agree on anything it’s time for a change.

  8. First of all, you are not exactly printing accurate information by starting with a dishonest premise. Many of the private health insurance companies have increased their deductibles or increased co-payments for the year 2012, without any help from a dysfunctional Congress or Super committee. As a result, I’ve had to shop around and change my own plan, which was about to double co-payments (, and is, by the way, more than a 2% increase). Do NOT assume that Medicare itself is going to be cut by 2%. The main result of the Congressional Super committee’s failure to act (what a surprise!) is that overbloated Defense spending will be cut back automatically. Medicare and Social Security will NOT be affected. If they were, I can assure you that the president would not bother running for a second term.

  9. Why doesn’t the government take some of the entitlements from the congress and senators. They get free medical coverage. Why shouldn’t they start paying . 249 of them are millionaires. Why should we be affected by the cuts, when most of us are living on fixed incomes. It will be a choice of eating, or buying prescriptions for a lot of us. How can a government treat its’ elderly generation like this. We are the ones who created America by our hard sweat and toil. This is just totally unfair. A nation is known by how it treats its’ old, young, disabled or poor. We soon will become a 2nd world country at the rate we are going.

  10. Thanks Joe.

  11. Mark, I think having the representatives go thru the alphabet soup of selecting a plan and then reading the details is a good idea.

  12. Margaret, But your idea requires people to take personal responsibility…… you’re my hero!

  13. Doug, I see your point, but many people are already maxed.

  14. Louis, It’s all spin. Same with emotionally charged terms like ObamaCare and Patriot Act.

  15. Frank, Well thought out plan. As it relates to health care costs I would add, rein in medical providers that order unneeded test and procedures…. just because they can. Many providers prey on the fears of Medicare beneficiaries, make recommendations and treat Medicare reimbursement like their unlimited cash machine.

  16. Ann, So we need some candidates that mirror our values? How do we keep them honest once they get to Washington?

  17. Robert, You must have a secret store of information not available to everyone else. The committee’s failure does call for a 2% reduction in Medicare spending. Congress may call out, Just kidding! But until then, your more than 2% increase has nothing to do with the super committee. Since I am not yet completely above making mistakes, I have had errors in my posts pointed out to me but I can assure you that starting with dishonest intent is not my goal. I have no political agenda on this site. Politically speaking…… I have tried on every pair of shoes in the store and have decided to go barefoot!

  18. Billie, Reducing representative’s benefits would make a lot of people feel good, but the money saved isn’t going very far.

  19. It seems as tough all Republicans and some Demos have a ring in their nose with the rope atached to Grover Norquist’s A__! I don’t remember voting for him..have they forgotten that?

    All their actions seem to stem from his hols over them. Ple4a remind them WE VOTE THEM IN.

  20. It seems as though all Republicans and some Demos have a ring in their nose with the rope atached to Grover Norquist’s A__! I don’t remember voting for him..have they forgotten that?

    All their actions seem to stem from his hold over them. Please remind them WE VOTE THEM IN.

  21. It’s not a comment, it’s a question. Just recently retired and am new to medicare – have never used the Part A. I don’t quite understand the system. Does it mean that you have to pay $1100+ before medicare will pay anything?

  22. Monica, Original Medicare has two Parts. Part A is the hospital coverage and Part B is for outpatient coverage. Each has a deductible. The Part A deductible of $1132 is required with the first nights stay in a hospital as an inpatient. No further hospital costs are incurred until you have been hospitalized 61 days as long as the services are covered by Medicare. The Part B deductible of $140 for 2012 is required prior to Medicare paying their 80% share of covered expenses.

    Enter your email address at the top right of this page to receive a free mini-course if you would like to know how a Medicare Advantage plan or Medigap policy may be of benefit. Also, here’s an article related to Medicare deductibles to give you more information.

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