Morning Bell: The Obamacare and Obama Tax Hike Double Whammy on Seniors
Conn Carroll /
No demographic was more opposed to Obamacare’s passage and no group wants to see the law repealed more than America’s seniors. They know that Obamacare used Medicare as a piggy bank to transfer half a trillion dollars out of Medicare, not to shore up Medicare’s solvency, but to spend on a new government program. As if that were not enough, now President Barack Obama wants to raise taxes on the dividend payments that millions of seniors depend on for their livelihood. American seniors are beginning to wonder when they’ll stop being target #1 of President Obama’s economy-crushing policies.
Obamacare’s Impact on Seniors: President Barack Obama repeatedly promised Americans that if they liked their current health plan, they could keep it. But as Heritage analyst Robert Book and Ethics and Public Policy Center fellow James Capretta detail in their new analysis of Reductions in Medicare Advantage Payments, that is demonstrably not true for millions of senior citizens. Medicare Advantage (MA) plans are the private insurance options available to Medicare beneficiaries. In 2006 (the latest figures available), Medicare covered only 59 percent of traditional beneficiary health care expenses. Ninety-one percent of all Medicare beneficiaries have some sort of supplemental coverage. Obamacare is going to change all that.
The new law imposes deep cuts in the payment rates for MA plans, beginning with a payment freeze in 2011. In addition, the other indiscriminate payment cuts to hospitals and health care providers will also get passed on to MA plans as well. Book and Capretta calculate that the average nationwide per capita reduction in the value of coverage for MA and would-be MA enrollees will total about $3,700 annually by 2017, or a nearly 27 percent cut from what would have occurred without the new law. Faced with these cuts, MA plans will be forced to raise premiums, reduce benefits or leave the market entirely. The President’s own Medicare chief actuary estimated that the number of seniors with MA plans will drop from 10 million today to just 7.4 million in 2017. (more…)