This week, the Centers for Medicare and Medicaid Services (CMS) announced next year’s premium rates for Medicare beneficiaries, and The Senior Citizens League (TSCL) endorsed two new bills – one from Senator Elizabeth Warren (MA) and one from Congressman Peter DeFazio (OR-4).
CMS Reveals 2016 Medicare Rates
On Wednesday, after months of anticipation, CMS announced the 2016 premiums for Medicare Parts A and B. Beginning in January, the Medicare Part B premium will increase from $104.90 to $121.80 per month – a 16 percent increase. In addition, the Part A premium – which 99 percent of beneficiaries do not pay – will grow by less than five dollars.
Since Social Security beneficiaries will not receive a cost-of-living adjustment next year, around 60 percent of beneficiaries will see no increase in their monthly Medicare premiums. They qualify for a provision called “hold harmless” and will pay the same monthly rate of $104.90 for Medicare Part B. However, around 15 million beneficiaries – including new beneficiaries, those who don’t collect Social Security benefits, those who are eligible for both Medicare and Medicaid, and those with higher incomes – will be faced with the 16 percent premium increase.
In a press release, Andy Slavitt – the Acting Administrator of CMS – said: “Our goal is to keep Medicare Part B premiums affordable. Thanks to the leadership of Congress and President Obama, the premiums for 52 million Americans enrolled in Medicare Part B will be either flat or substantially less than they otherwise would have been. Affordability for Medicare enrollees is a key goal of our work building a health care system that delivers better care and spends health care dollars more wisely.”
Like Acting Administrator Slavitt, TSCL is pleased that Congress was able to avert the 50 percent jump in Part B premiums in the bipartisan budget deal that was signed into law two weeks ago. In the months ahead, we will be advocating for legislation that would provide Social Security beneficiaries with an emergency COLA to help cover rising costs like the 16 percent premium hike that some Medicare enrollees will be paying next year.
TSCL Endorses SAVE Benefits Act
This week, Senator Elizabeth Warren (MA) introduced the Seniors and Veterans Emergency (SAVE) Benefits Act (S. 2251) with the support of nineteen cosponsors. The bill, if signed into law, would provide Social Security beneficiaries and retired military members with a 3.9 percent COLA in 2016, which would amount to around $581 for the average beneficiary. The bill would offset the cost of the emergency COLA and extend the life of the Social Security Trust Funds by closing corporate compensation loopholes.
Upon introducing the bill, Sen. Warren said, “If we do nothing, on January 1st, more than 70 million seniors, veterans, and other Americans won’t get an extra dime in much-needed Social Security and other benefits. And while Congress sits on its hands and pretends there’s nothing we can do, taxpayers will keep right on subsidizing billions of dollars’ worth of bonuses for highly paid CEOs. Giving seniors a little help with their Social Security and stitching up corporate tax write-offs isn’t just about economics; it’s about our values.”
TSCL agrees that Congress must act before the end of this year to provide seniors and veterans with an emergency COLA in 2016. We enthusiastically support the SAVE Benefits Act, and we look forward to working with Senator Warren’s office in the coming months to help build support for her critical new bill.
TSCL Endorses CPI-E Act
TSCL also endorsed legislation from Congressman Peter DeFazio (OR-4) this week. His new bill – the Consumer Price Index for Elderly Consumers (CPI-E) Act (H.R. 3961) – would create a new inflation index specifically for seniors, and it would base Social Security COLAs on it.
Currently, COLAs are based on the inflation experienced by young, urban workers, using the CPI-W. That index often underestimates the inflation seniors experience since it fails to capture the rising costs of expenses like medical care, prescription drugs, property taxes, and housing. If the CPI-E were used, Social Security beneficiaries would receive a 0.6 percent COLA in 2016 – not a zero COLA.
Switching to an inflation index specifically for seniors would result in more accurate COLAs for beneficiaries, and TSCL believes H.R. 3961 would go a long way in ensuring the retirement security seniors have earned. We will advocate for Congressman DeFazio’s bill tirelessly in the months ahead, and we will post updates on its progress here in the Legislative News section of our website.
