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Representative McDermott Asks for a Comprehensive Look at the Unintended Consequences of Medicare Benefit Reform

Press Release

Location: Washington, DC

Today, Representative Jim McDermott, ranking member of the Ways and Means Subcommittee on Health, opened the first hearing of the new Congress by warning against potential cost shifting and other unintentional consequences of reforming the Medicare benefit.

"Benefit restructuring specifically to generate savings--whether in the name of deficit reduction, paying for other initiatives, or simply masquerading as "reform'--is bad policy and bad politics," said McDermott. "It may be tempting when running the numbers and calculating the averages, but it is all too easy to lose sight of the very real people whose lives and wellbeing hang in the balance."

Reforms such as a unified deductible and co-insurance for Parts A and B could lead to untenable price hikes for seniors. Half of all Medicare beneficiaries live off of $22,500 or less annually and spend a larger share of their income on health needs than young people. Thus, additional deductibles and other forms of cost sharing have a disproportionate impact on the Medicare population.

McDermott also called for bipartisan work on Sustainable Growth Rate, or SGR, reform:

"I want to express my optimism that bipartisanship will enable the Committee to move forward on SGR reform. The recent Republican outline leaves plenty of room for agreement if people want to find it. If done smartly, this issue could reshape our entire health economy for the better, but costs can't just be hoisted onto the backs of beneficiaries. There are better options, with strong policy justifications, to pay for the needed SGR policy changes."

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