WASHINGTON, July 16 (UPI) -- Despite many seniors expecting change in Medicare because of healthcare reform, most won't see any, U.S. researchers said.
Researchers at the Urban Institute said under the Patient Protection and Affordable Care Act the higher income-related Medicare Part B premiums -- for those with individual income of $85,000 and $170,000 for a couple are frozen from 2011-2019, resulting in more people in this income range each year subject to higher premiums providing an extra $25 billion in revenue for Medicare.
The law also reduces the Medicare Part D -- prescription drug plan -- subsidy for those with incomes $85,000 and above for an individual and $170,000 for a couple, effective 2011, resulting in another $10.7 billion in revenue over 10 years.
In addition, the law gradually lowers the beneficiary co-insurance rate in the Medicare Part D coverage gap from 100 percent to 25 percent by 2020. For brand drugs, pharmaceutical manufacturers will be required to provide a 50 percent discount on prescriptions beginning in 2011, in addition to federal subsidies of 75 percent of brand-name drug cost by 2020. This will save seniors about $43 billion over 10 years, the report says.
Currently, the federal government provides a subsidy to Medicare Advantage plans at about 9 percent more than the cost to the plans for providing the statutory Medicare benefits. These plans can include eye glasses, hearing aids and health club memberships. The legislation restructures payments to Medicare Advantage plans by setting payments to different percentages of traditional Medicare spending rates as calculated at the county level, saving about $136 billion for Medicare.