NRLN Has Long Advocated Medicare Out-of-Pocket Cost Cap and Medicare Buy-In

On February 1, 2017, the NRLN published a whitepaper: Medicare Out-of-Pocket Health Cost Limits – The Unfinished Business of Protecting Medicare Beneficiaries from Catastrophic Health Care Costs. The NRLN noted that “one of the landmark achievements of the Patient Protection and Affordable Care Act of 2010 is that it prohibits insurance plans from imposing any annual or lifetime limits on the dollar value of covered benefits. The legislation also caps the mount individuals and families must pay out of their own pocket each year, setting an out-of-pocket limit that varies by income. Unfortunately, the protection against ruinous health costs that Congress will guarantee as a right to nearly all Americans under the age of 65, Congress denies  those over age 65 who are most vulnerable: senior citizens.”

Congress’ own commission, MedPAC, produced a report and charts in 2020 showing members of Congress that 25% of the Fee-for-Service (FFS) beneficiaries over age 65 account for 85% of Medicare spending. The MedPAC report states that “Costly beneficiaries tend to be those who have multiple chronic conditions, are using inpatient hospital services, are dually eligible for Medicare and Medicaid, and are in the last year of life.” 

We advocated in our 2017 whitepaper, “Now that national health reform legislation has established the principle that no American should be forced into bankruptcy or onto the public dole to pay catastrophic medical bills, Congress should ensure that this protection is extended equitably to the 65-and-older population as well.”  

The Choose Medicare Act also requires the Secretary of Health and Human Services to “establish public health plans (to be known as ‘Medicare part E plans’) that are available in the individual market, small group market, and large group market.”

The NRLN produced a whitepaper, also dating back to 2017, with the title: Health Care Access for Older Adults The Urgent Need for a Medicare Buy-In Option. In contract to the Choose Medicare Act, the NRLN’s proposal would provide a Medicare Buy-In at a reasonable cost for Americans ages 55 to 64 who had lost their healthcare coverage because they had been laid off, forced into early retirement or because their employer canceled coverage. The Medicare buy-in would also be available to these older citizens who are denied coverage, or lack affordable coverage, or because they are self-employed, underemployed or work at small firms not offering group health coverage.

The NRLN believes its Medicare Buy-In proposal makes more sense than the Plan E in the Choose Medicare Act which would open up Medicare enrollment to “any individual who is a resident of the United States, as determined by the [HHS] Secretary under subparagraph….” Those under age 65 are covered by individual small and large company plans and the Affordable Care Act (ACA). Congress should eliminate unearned private plan rebates and focus on the real problems, provider industry cost of healthcare and applied research focused on cures. 

Medicare Plan E could be offered with an annual premium consisting of the FFS incurred cost plus 2% to cover Medicare overhead. Annual plan premiums would be less costly than private Medigap plans, taxpayers would pay nothing, and Congress could set special rates for those needing special assistance.