Bob Beauprez

Last month, the Obama Administration moved forward with new Medicare spending cuts that few outside ardent industry observers noticed. If put into place, however, these cuts will mean significantly less money in the pockets of some 14 million senior citizens around the country.

But with health care costs projected to rise another three percent, these reductions couldn’t come at a worse time.

When President Obama signed the Affordable Care Act into law, he simultaneously authorized $200 billion in cuts to the Medicare Advantage program. At the time, the Congressional Budget Office projected that the health care reform law’s cuts would result in three million fewer Medicare Advantage enrollees. Moreover, actuaries at Oliver Wyman predicted that the cost of the health insurance tax would mean an additional $3,500 in out-of-pocket expenses for seniors over the next ten years.

If all that weren’t bad enough, a few weeks ago the Centers for Medicare and Medicaid Services (CMS) proposed an additional 2.3 percent reduction in Medicare Advantage payments for 2014.  This new reduction, combined with the cuts in the health care law, mean Medicare Advantage payments next year will go down by more than eight percent, or about $11 billion.

Oliver Wyman calculates the impact in 2014 will be $50 to $90 per month in some combination of benefit cuts and premium increases per senior participant. As the full effect of the mandated ObamaCare cuts become fully implemented, the impact worsens significantly.


Bob Beauprez

Bob Beauprez is a former Member of Congress and is currently the editor-in-chief of A Line of Sight, an online policy resource. Prior to serving in Congress, Mr. Beauprez was a dairy farmer and community banker. He and his wife Claudia reside in Lafayette, Colorado. You may contact him at: http://bobbeauprez.com/contact/