Medicare and Social Security disability protected from major cost increases


Infrequently do decisions in our nation’s capital have immediate and direct consequences for Hill residents. But last week’s budget compromise benefits Medicare Part B recipients who are not receiving Social Security, and Social Security disability recipients.

Local Congressman Dr. Raul Ruiz said, “Yesterday [Oct. 28] I voted in favor of the bipartisan budget bill that passed the House. This budget will protect Medicare and Social Security, and it ensures that as a country we pay our bills like we expect American families to pay their bills. Congress must stop playing politics by holding the debt limit over the heads of the American people and threatening to crash the economy.”

Those Medicare Part B recipients, about 30 percent of the total Medicare insurees, were facing a 59-percent increase in premiums beginning in January.

Because the Social Security Administration’s calculation of Social Security inflation increases resulted in no increase in 2016, the current law prohibits any increase in Medicare since it is withheld from Social Security payments.

Consequently, the other Medicare beneficiaries would have been responsible for all Medicare cost increases in 2016 in order to maintain its actuarial balance. Monthly premiums of $104.90 would have jumped to $159 monthly in January.

The budget compromise does not forgive the full increase, but does limit it to $123 monthly, of which $3 is for a loan for the balance. This may change in the future.

Beginning in 2017, all Part B beneficiaries will pay higher deductibles, an increase from $147 to about $167 monthly.

Social Security disability payments also were scheduled to be reduced as much as 20 percent for 11 million recipients of the disability insurance because the disability fund was running out of money. But the budget bill also modifies this action. Money will be borrowed from the overall Social Security payroll tax revenues to protect this fund. Congress also tightened the eligibility requirements for the disability program. The bill also increases efforts to reduce fraud within the program and reduce over payments.

The House of Representatives approved the legislation on Wednesday and the Senate approved it and sent to the president on Friday, Oct. 30.

On Tuesday, Oct. 27, after the compromise was announced, but before any House or Senate votes, AARP CEO Jo Ann Jenkins praised the announcement. “AARP applauds today’s bipartisan agreement by Congressional leaders and urges members of Congress to support this legislation that would help to ensure millions of American families no longer face looming cuts to their earned benefits,” Jenkins said in a press release. “In addition, families of veterans, children and others with disabilities must no longer worry about facing a sharp benefit reduction in the months ahead, and many Medicare beneficiaries no longer must face a massive 52-percent increase in their Part B premiums and deductibles.”

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