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Hearing Seeks Agreement on Medicare Reform

The Senate Special Committee on Aging conducted a hearing last week to try to develop a strategy to reform the Medicare program in a way that would be acceptable to both Democrats and Republicans.

Ranking Member Bob Corker (R-TN) called for the hearing, A Time for Solutions: Finding Consensus in the Medicare Reform Debate, to develop specific recommendations that could be passed on to the Joint Select Committee on Deficit Reduction. Citing Congressional Budget Office (CBO) baseline estimates that Medicare spending will increase 56 percent to one trillion dollars in the next ten years, Senator Corker emphasized the need for reform. “Medicare is America’s largest fiscal and health care challenge and is getting more difficult to solve every day we don’t address it,” said Senator Corker.

Panelists agreed that Medicare reform is needed. Although they differed on emphasis, there were commonalities in many panelists’ approaches to reform. Panelists, for example, agreed on raising the eligibility age. Some cited a gradual increase to age 67, while others avoided naming a specific number. Panelists also agreed on restructuring incentives to encourage both providers and beneficiaries to cut costs. In order to do this many of the panelists advocated for increased cost sharing. “Medicare is a hodge-podge of various different deductibles, co-pays, and co-insurance rates that are too complex and confusing to establish the correct incentives,” said Maya MacGuineas, President of the Committee for a Responsible Federal Budget. “On top of that, many seniors purchase Medigap or other supplemental insurance to cover most or all of their cost-sharing – meaning that for many beneficiaries there is no real ‘skin in the game.’”

In addition to the panelists’ testimony, Chairman of the Senate Special Committee on Aging, Herb Kohl (D-WI,) released a letter he sent to the Co-Chairs of the Joint Select Committee on Deficit Reduction. The letter outlined Senator Kohl’s own recommendations for reforming Medicare and other programs that affect seniors. His recommendations include allowing Medicare to negotiate drug prices in Medicare Part B when it is the majority purchaser, reducing the incentive for doctors to prescribe name brand drugs over generics, and requiring drug manufacturers to discount medication for low-income Medicare beneficiaries.

Read the panelists’ statements and view the hearing in its entirety.


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