Congress Saves the Postal Service but Shifts Costs to Medicare

Congress Saves the Postal Service but Shifts Costs to Medicare

Recently we reported that the House of Representatives had passed a bill that would go a long way toward keeping the U.S. Postal Service solvent and in business. They did that by shifting the Postal Service retiree medical costs to Medicare. The bill has now gone to the Senate and may be voted on this week.

The legislation is important for seniors because so many of us receive our prescriptions through the mail. However, we also noted that the bill was adding news costs to Medicare and Medicare itself urgently needs Congressional action because its trust fund is expected to become insolvent in just four short years.

We noted in our report that we had not found how much additional cost there would be Medicare. Now, that number has come to light.

Kaiser Health News has reported that the Congressional Budget Office has estimated “the move could save the postal retirement and health programs about $5.6 billion through 2031 while adding $5.5 billion in costs to Medicare during that span, and probably much more in later years.”

While that number seems exceptionally large to all of us, it’s only a small fraction of what Medicare spends. But it does, once again, raise the issue that Congress must deal with the Medicare solvency issue – sooner rather than later.

That issue has been raised in the Senate, but it is highly unlikely Congress will start working on it this year given everything they still have to deal with, the toxic partisan culture that exists, and the fact that this is an election year.

TSCL’s Social Security and Medicare policy analyst, Mary Johnson, was quoted in the article. She pointed out that the failures of the mail system also have health consequences, with payments for insurance and shipments of prescriptions going missing.

Shoring up both Medicare and Social Security remains at the top of TSCL’s lobbying agenda and we will continue to push Congress to begin action on those issues.