Government affairs

Legislative Updates

House and Senate introduce Medicare Premium Fairness Act

Rep. Dina Titus (D-NV) and Sen. Ron Wyden (D-OR) have introduced the Medicare Premium Fairness Act of 2015, (H.R. 3696 and S. 2148) aimed at preventing a potential 52 percent increase in Medicare Part B premiums in 2016 for nearly 7.5 million Americans, including certain letter carriers who are covered by both Medicare  and the Civil Service Retirement System. Please call your senators and representatives at (202) 224-3121 and urge them to co-sponsor these bills.

The legislation comes as a result of the Oct. 15 announcement by the Social Security Administration that there would be no cost-of-living adjustment (or “COLA”) for 2016. This was due to a lack of increase in the Consumer Price Index (CPI-W) over the prior year.

Under current law, when there is no cost-of-living adjustment, Medicare Part B premiums cannot be raised for people who are already receiving a Social Security check. The Social Security Act contains a “hold harmless” provision that states that the dollar increase in the Part B premium is limited to the dollar increase in an individual’s Social Security COLA. With no COLA in 2016, an estimated 70 percent of beneficiaries will be “held harmless,” meaning their Part B premium will remain stable at $104.90.

However, the remaining 30 percent of Medicare Part B beneficiaries are not held harmless under current law. Among them are federal retirees covered by CSRS who do not receive Social Security benefits. For them, without legislative action, 2016 premiums will increase by 52 percent, from $104.90 per month to $159.30 per month. The annual deductible for this group will also increase by 52 percent, from $147 to $233. Taken together, the monthly premium and annual deductible increases would total $729 annually for most retirees who do not receive Social Security benefits. If the hold harmless provision did not exist, all beneficiaries would see a much smaller increase of 15 percent, which equates to $120.70 per month. 

“It is grossly unfair not to extend the hold harmless protection to CSRS recipients, given that they will not receive a COLA on their benefits either,” NALC President Fredric Rolando said. “It is even more unfair to require non-Social Security recipients to cover the increased cost of Part B for the whole program while exempting 70 percent of Part B enrollees who happen to receive Social Security benefits.”

H.R. 3696 and S. 2148 would amend Title XVIII of the Medicare of the Social Security Act to prevent 2016 increases to Medicare Part B premiums and deductibles for all Medicare participants (including people who do not receive Social Security). The measure authorizes funding to keep monthly premiums temporarily frozen at their 2015 levels for all Medicare participants.

“Today’s fix will protect millions of seniors across the country from an abrupt and dramatic increase in Medicare costs,” Wyden said. “It is urgent that Congress take decisive action to ensure vulnerable Americans aren’t harmed by this archaic policy.” 

“My legislation will keep premium and deductible rates at 2015 levels, and will protect our seniors from shouldering the burden of these increases when too many are struggling to make ends meet,” Titus said. “Such increases are unacceptable for seniors who count on every dollar of their benefits.”

Titus introduced similar legislation in the 111th Congress to prevent premiums from increasing in 2010. The legislation passed the House but it went no further than that. Leaders in both the House and Senate are reportedly discussing a Part B fix; however, a “pay-for” provision (either a tax increase or a spending cut) will be needed to comply with the federal PAYGO law.

NALC highly encourages all members to weigh in with their members of Congress in the House and Senate to ask for their support for the Medicare Premium Fairness Act.

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