Medicare Reform Proposal Comparison

Barack Obama
Summary
The Obama administrations FY 2013 budget proposes increased premiums for high-income bene ciaries under Medicare Parts B and D. President Obama relies on other reforms in the A ordable Care Act to cut costs.

Mitt Romney
Based on the Wyden-Ryan plan released in December 2011, this proposal would transition the Medicare system to a hybrid premium-support model. Using a de ned contribution from the government, bene ciaries would have the choice to remain in traditional Medicare or purchase insurance on the private market.

Premium Support

Maintains traditional Medicare as Default

Bene ciary Costs

All starting in 2017: Income-related Part B and D premiums would go up 15% until 25% of bene ciaries are a ected. For new bene ciaries, Part B deductible would go up $25; a home health co-pay would apply in some cases and a premium surcharge would apply to certain Medigap plans. Bene ciaries would be issued a voucher to use toward purchasing insurance or remaining in Medicare fee-for-service. The voucher amount would equal the second-least expensive approved private plan or fee-for-service in the region. Bene ciaries who choose to purchase a private plan would be responsible for paying any di erence between the cost of their insurance and the voucher amount.

Eligibility Age
Not mentioned. Starting in 2023, this plan increases the Medicare eligibility age by two months each year until it reaches 67 in 2034.

Budget De cit
This plan would result in de cits amounting to $6.4 trillion from 2012 to 2022, or 3.2% of total GDP, according to the CBO. Budget de cits would be 2% of GDP or less from 2023 to 2050, and the budget would be nearly balanced by 2050, according to the CBO.

Medicare Spending
On top of $716 billion in spending reductions under the A ordable Care Act, Obamas 2013 budget would reduce Medicare expenditures by $276 billion from 2013 to 2022, not including the freeze on physician payment rates, according to the CBO. Maintains $716 billion in Medicare spending reductions included in the A ordable Care Act, according to the CBO.

Physician Payments/Sustainable Growth Rate

Substitutes SGR with a plan to freeze physician payment rates at the 2012 level for the next 10 years. Doesnt include a plan to prevent the physician pay cut scheduled for 2013 or a permanent x for the SGR.

Other
Reduces coverage of bad debt resulting from bene ciary non-payments to 25% (from 70% for hospitals and skilled nursing facilities and 100 percent for select other providers such as dialysis centers) over 3 years starting in 2013, which would save $36 billion over 10 years as part of the $276 billion in reductions under the 2013 budget. Repeals the Independent Payment Advisory Board.

Link to Proposal
http://www.whitehouse.gov/omb/budget/ overview http://budget.house.gov/fy2013Prosperity/