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Protecting Medicare Now, Saving it for Future Generations


Location: Washington, DC

Medicare is a critical program that helps seniors achieve health security. But the truth is, without urgent action from Congress, Medicare will go bankrupt in about a decade's time. I support a plan that protects the program for those 55-years of age and older, and takes action to strengthen Medicare so it is available for future generations, too.


The average American household spends nearly 50 times more on healthcare today than it spent in 1960. As a result, healthcare spending has gone from consuming 5.6 percent of our economy in 1960, to consuming 17.6 percent of our economy today.

Medicare is a top driver of this unsustainable increase in costs. If we do nothing, Medicare spending will nearly double in the next decade, exhausting its remaining funds and going bankrupt by 2020, according to the nonpartisan Congressional Budget Office.

Medicare and other mandatory entitlement programs cost $1.5 trillion in 2010. That's more than our total annual defense budget. The first of 77 million baby boomers turn 65 this year and qualify for Medicare. Enrollment will grow from 48 million in 2010 to 64 million in 2020 and 81 million in 2030, according to Medicare actuaries.

According to 2010 figures, the average single male wage earner paid $58,000 into the system during their lifetime, but will receive $167,000 in benefits. In 2030, this figure is exasperated, with the average beneficiary paying $87,000 into and receiving $251,000 out of the Medicare program.


So what does it mean for you when the Medicare Part A trust fund can no longer cover its debts? It means that the federal government will be forced to significantly reduce reimbursements to doctors. The end result is fewer doctors who will accept seniors with Medicare: that's less access and fewer services for America's seniors.

Most doctors will tell you they lose money by participating in Medicare. Studies show that doctors and other healthcare providers faced with further Medicare reductions will simply stop accepting new Medicare patients, limit the services they offer, or stop taking Medicare patients altogether.

The American Medical Association says that nearly one-third of primary care physicians restrict the number of Medicare patients in their practice, and the American Academy of Family Physicians reports that 13% of its doctors simply don't accept Medicare patients, up from 8% in 2008 and 6% in 2004.


The House of Representatives is the only chamber of Congress to have voted on a plan to save the Medicare trust fund's past its projected bankruptcy date in one decade's time.

For Americans age 55 and up

House plan:

* No changes whatsoever.

President's plan

*$500 billion in cuts to Medicare Advantage (under the new health law)

*Further reduce Medicare payments to providers by handing over control to an unelected board of bureaucrats, the Independent Payment Advisory Board (under the new health law)

For future generations

House plan:

*Implements reforms similar to the successful Part D and Medicare Advantage programs to rein in the exploding costs of Medicare, while ensuring choices and access for America's seniors

*Offers future beneficiaries the same kind of health-care options available to Medicare Part D prescription drug benefit enrollees

*Uses a means test so wealthy Americans contribute more

President's plan:

*No plan to save Medicare past its bankruptcy date

*Continues physician reimbursement cuts that threaten access to healthcare

Building on the success of Medicare Part D

The House plan would be similar to the successful Medicare Part D prescription drug benefit, which allows seniors to shop around and choose their insurance provider based on their individual needs. Because of the competitive nature of Part D, the program has come in way under budget.

Current estimates put the Part D program's cost to the federal government at less than 41% what was originally projected, and that the premiums paid are substantially less. The original projection for average monthly premiums for 2011 was $53, whereas actual premiums are $30.


One of the early votes Rep. Walden cast in 2011 was to repeal the sweeping new healthcare legislation signed into law by President Obama.

The new health law eliminated $500 billion in Medicare Advantage (MA) payments. Over 254,000 Oregon seniors, or 41% of the state's Medicare population, have a Medicare Advantage plan. Nationally, only about one-quarter of the entire Medicare population has Medicare Advantage, meaning that cutting the program for Oregon seniors could have a much deeper impact.

Rather than use this $500 billion to contribute to the Medicare trust fund's insolvency, the nonpartisan Congressional Budget Office said that it "would be used to pay for other spending and would therefore not enhance the ability of the government to pay for future Medicare benefits."

The new law created a board of unelected and unaccountable officials, called the Independent Payment Advisory Board (IPAB), who will be paid hefty salaries and will be specifically charged with finding ways to reduce Medicare reimbursement to doctors, as well as what services the program will and will not cover.

The end result of the $500 billion in Medicare Advantage cuts and the cuts implemented by the IPAB is less access for seniors to doctors willing to accept them. It would also drive prices up as providers still willing to accept Medicare patients would be forced to offset their losses by charging more for non-Medicare patients.

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