Vice President Joe Biden is working to find savings that will lead to a deal with Republicans to increase the debt ceiling.
Panel urges Congress to make major Medicare changes
As Congress seeks cuts, the 2 plans could save billions
WASHINGTON — As Vice President Joe Biden and congressional negotiators hunt for budget cuts, major Medicare changes that could squeeze billions in savings got a boost yesterday from a nonpartisan panel of specialists that advises lawmakers.
Those changes are already under consideration in the budget talks, officials say.
One idea would revamp Medicare’s outdated copayments and deductibles to provide better protection against catastrophic expenses, but it could lead to seniors paying a bigger share of the cost for some common services.
The goal is to save taxpayers money by discouraging overtreatment.
The impact on individual seniors is less clear. Few details are available, but such changes could create winners and losers.
Seniors with high medical costs would gain from having a limit on their financial exposure, protection that Medicare does not now provide. Those who see the doctor often for more manageable problems could end up paying more. Overall, premiums for private insurance that many seniors get to fill in Medicare’s gaps could become more affordable.
The other idea under consideration would shift nearly 9 million high-cost beneficiaries with both Medicare and Medicaid into managed-care insurance plans, to better coordinate services and cut duplication.
The Medicare Payment Advisory Commission did not endorse any specific approach, but its traditional midyear report to Congress made clear that both issues are overdue for a fix.
“The status quo . . . has led to care that is often not coordinated, sometimes inappropriate, and occasionally risky to patients,’’ said the report, referring to Medicare’s traditional fee-for-service benefit. “It has also left beneficiaries with rising . . . premiums and out-of-pocket costs and has left taxpayers with the unsustainable burden of financing the program.’’
The aim should be “to give beneficiaries better protection against high [out-of-pocket] spending and to promote incentives for them to weigh their use of discretionary care, without discouraging needed care,’’ said the report from MedPAC, as the commission is known.
Officials familiar with the negotiations between Biden and leading lawmakers of both parties said the two Medicare options are under consideration. The officials spoke on condition of anonymity because the budget talks are confidential.
Biden’s goal is to find savings that will help the administration reach a deal with congressional Republicans to increase the nation’s $14.3 trillion debt ceiling. That is needed to prevent the government from lurching into an unprecedented default on its interest payments to creditors, which could destabilize the already wobbly economy.
Prospects for the talks are uncertain, since both political parties are locked into their positions.
House Republicans are on record that they will not vote to approve a debt increase without deep spending cuts.
Democrats, meanwhile, are taking a hard line against any reduction in Medicare benefits, including increased copayments for visits to doctors and hospitals.
A sweeping overhaul of Medicare and Medicaid backed by House Republicans seems to have no chance.
Instead, the budget negotiators are looking at a list of proposals outlined last year by President Obama’s deficit-reduction panel. Most involve cuts in payments to medical service providers and drug companies, but some would affect seniors directly.