Advocates for seniors are optimistic that a short-term fix will happen - despite the current chaotic situation in the House of Representatives. “There will a bigger spontaneous grassroots reaction to this than we might normally expect,” says Nancy LeaMond, who heads government affairs at AARP.
Working Out The Details
The key issue is how to pay for the fix. Protecting all Medicare beneficiaries from the increase would cost $10 billion to $12 billion. "The question will be - 'Is that a reasonable number, does it have to be offset and how do we pay for it?'" says Stacy Sanders, federal policy director for the Medicare Rights Center.
The COLA crunch also points to the need for a longer-term fix at some point.
One way to do this is to change the inflation gauge used for the COLA to the Consumer Price Index for the Elderly (CPI-E), which recognizes the greater role of healthcare costs in spending by seniors.
Healthcare inflation is on the march again after several years of flat growth. That is reflected not only in the Medicare Part B conundrum, but also in projections that many seniors could be facing double-digit increases in Part D prescription drug premiums.
It is also time to re-examine the hold-harmless provision itself. We are no longer in an era in which Medicare and Social Security enrollment are synchronized for all Americans, and it makes no sense to expose only some beneficiaries to outsize premium hikes.