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As 'Super Committee' Ponders Medicare Cuts, Actuaries Weigh In

Margaret Dick Tocknell, for HealthLeaders Media, September 14, 2011

Another approach would establish a government-run Part D option that would be offered alongside Part D private plans. The Centers for Medicare & Medicaid Services would negotiate prices with prescription drug companies. The concern is that this could lead to CMS setting prescription drug prices. Also, introducing a government-run Part D option could mean some current Part D providers might leave the market and reduce the choices available for enrollees.

Still, reducing drug prices would lower Part D spending and reduce its growth rate. Lowering Part D spending would also reduce beneficiary premiums for Part D plans and some copayments.

6.Raise the Medicare Eligibility Age
A study by the nonpartisan Kaiser Family Foundation found that raising the Medicare eligibility age from 65 to 67 in 2014 would generate about $7.6 billion in net savings to the federal government, but it would add $5.6 billion in out-of-pocket costs for 65- and 66-year-olds, and $4.5 billion in employer retiree healthcare costs

But some of that savings would be at the expense of employers, states, and beneficiaries. People between age 65 and 67 would need to find another source of health insurance. They might stay on employer-sponsored insurance plans, qualify for other public coverage such as Medicaid or seek coverage in the individual market or through health insurance exchanges.

As everyone knows, there are no simple options and difficult decisions will need to be made to preserve Medicare. But the focus shouldn't just be improving Medicare's immediate financial woes but rather improving the long-term sustainability of the program.


Margaret Dick Tocknell is a reporter/editor with HealthLeaders Media.
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1 comments on "As 'Super Committee' Ponders Medicare Cuts, Actuaries Weigh In"


Todd (10/7/2011 at 9:19 AM)
Paying for out-of-country care and encouraging Medicare beneficiaries to travel outside the US for surgery to certain lower cost and higher quality locations would be a great idea.