Medicare beneficiaries would likely face more out-of-pocket costs. Because per-person health care costs are projected to grow faster than the federal premium support payments under the Rivlin-Domenici Plan, costs will continue to increase in both the near- and long-term, and either beneficiaries will have to pay more or providers will have to discount an ever-greater part of their charges.
In an article written in December 2011, Alice Rivlin, Ph.D., and former U.S. Sen. Pete Domenici (R-N.M.) specify that it would be the beneficiaries who pay the difference, stating that, “In the event that Medicare spending per beneficiary rises at a faster rate, enrollees will have to pay higher premiums to cover the difference.
This will most likely mean a negative financial impact beneficiaries. In the Congressional Budget Office’s (CBO) report, “Preliminary Analysis of the Rivlin-Ryan Health Care Proposal,” which is largely based on the Rivlin-Domenici proposal, it concludes that, “voucher recipients would probably have to purchase less extensive coverage or pay higher premiums than they would under current law, for two reasons.
First, most of the savings for Medicare under the proposal stem from reducing the amounts that the federal government would pay for enrollees on a per capita basis, relative to the projections under current law. Second, future beneficiaries would probably face higher premiums in the private market for a package of benefits similar to that currently provided by Medicare.” This is consistent with the CBO’s previous findings and analyses of premium support systems, which highlight that beneficiary spending, as well as spending uncertainty, would increase under premium support.
RELATED FAQs
How Would the Rivlin-Domenici Plan Reduce Federal Health Care Spending?
How Would the Rivlin-Domenici Plan Contain Rising Health Care Costs?
Is There More Than One Plan to Reform Medicare?
What Does U.S. Rep. Paul Ryan’s (R-Wis.) Propose for Medicare Reform in the House Budget Committee’s Fiscal Year 2012 Budget, “The Path to Prosperity?”
What Is President Barack Obama's Position on Medicare Reform?
