45 Years After Medicare's Implementation, Republicans Are Trying To End It

July 01, 2011 1:21 pm ET

45 years ago today, Medicare was implemented. As a cornerstone of the American health care system, Medicare has provided access to health care to millions of elderly and disabled Americans over the last several decades. However, despite its indisputable place in American society, House Republicans have voted to dismantle the program with their latest budget. Both House and Senate Republicans have also spent years trying to gut the program of over a trillion dollars. Medicare continues to be necessary to help the elderly and disabled, and unfortunately, the Republicans have decided not to keep their interests in mind.

Medicare Covers 47 Million Americans, Almost Half Of Them Low-Income

Medicare Covers 47 Million Americans "Regardless Of Their Income Or Medical History." According to Kaiser Family Foundation: "Medicare is the federal health insurance program created in 1965 for all people age 65 and older, regardless of their income or medical history, and now covers 47 million Americans. Medicare, in conjunction with Social Security, plays a vital role in helping to provide financial security to seniors and younger beneficiaries with disabilities." [KFF.org, September 2010]

"Nearly Half" Of Medicare Recipients "Live On Incomes Below 200%" Of The Federal Poverty Level. According to Kaiser Family Foundation: "Medicare covers a diverse population; nearly half of all people on Medicare (47%) live on incomes below 200% of poverty ($21,660 for individuals and $29,140 for couples in 2010)." [KFF.org, September 2010]

56 Percent Of Medicare Beneficiaries Are Women. According to Kaiser Family Foundation: "More than half (56%) of all Medicare beneficiaries are women; among the oldest old (ages 85 and older), 70% are women." [KFF.org, June 2009]

  • Female Beneficiaries Are More Likely Than Male Beneficiaries To Be Living In Poverty Or Near-Poverty. According to Kaiser Family Foundation: "Older women have lower average Social Security and pension benefits than men, primarily because they had lower-paying jobs than men during their working years and because many worked parttime or left the workforce for periods of time to raise families or care for aging family members. In 2007, the median annual household income for women ages 65 and older was $23,400, substantially lower than $38,222 for older men. In addition, more women Medicare beneficiaries than men on Medicare are living in poverty or near-poverty." [KFF.org, June 2009, internal citation removed for clarity]

8 Million Medicare Beneficiaries Are Under 65 And Disabled. According to Kaiser Family Foundation: "Medicare also covers certain nonelderly disabled widows and widowers, as well as disabled adult children of retired, deceased, or disabled workers. Today, Medicare covers 8 million people who are under age 65 and disabled, or 17% of the Medicare population, up from 8% in 1975." [KFF.org, September 2010]

  • 2008: One In Three Nonelderly Medicare Beneficiaries Lived On Incomes Below The Poverty Line. According to Kaiser Family Foundation: "More than one-third (35%) of nonelderly beneficiaries lived on incomes below 100% of poverty in 2008 — $10,400 for an individual that year — compared to 12% of seniors. Two-thirds (67%) had incomes below twice the poverty level, compared to 42% of seniors. A larger share of nonelderly disabled than elderly beneficiaries are black (17% versus 8%) and Hispanic (11% versus 7%), and a larger share are male." [KFF.org, September 2010]

The House-Passed GOP Budget Would End Medicare As We Know It

"The Path To Prosperity" Turns Medicare Into A Voucher System. From "The Path to Prosperity":

Save Medicare for current and future generations while making no changes for those in and near retirement. For younger workers, when they reach eligibility, Medicare will provide a Medicare payment and a list of guaranteed coverage options from which recipients can choose a plan that best suits their needs. These future Medicare beneficiaries will be able to choose a plan the same way members of Congress do. Medicare will provide additional assistance for lower-income beneficiaries and those with greater health risks. [The Path To Prosperity, 4/5/11]

CBO: Under The GOP Budget, "Most Elderly People Would Pay More For Their Health Care Than They Would Pay Under The Current Medicare System." According to the Congressional Budget Office: "Under the proposal, most elderly people would pay more for their health care than they would pay under the current Medicare system. For a typical 65-year-old with average health spending enrolled in a plan with benefits similar to those currently provided by Medicare, CBO estimated the beneficiary's spending on premiums and out-of-pocket expenditures as a share of a benchmark: what total health care spending would be if a private insurer covered the beneficiary. By 2030, the beneficiary's spending would be 68 percent of that benchmark under the proposal, 25 percent under the extended-baseline scenario, and 30 percent under the alternative fiscal scenario." [CBO.gov, 4/5/11]

In 2022, A Typical 65-Year-Old Would Be Paying Approximately Double Compared To Current Levels. The Center on Budget and Policy Priorities prepared a graphic comparing health care spending for a typical 65-year-old under the current system to the same spending under the Republican budget:

[CBPP.org, 4/7/11]

CEPR: The Republican Budget Would Leave "Seniors With A Bill Of $20,700." According Dean Baker, the co-director of the Center for Economic and Policy Research:

According to the CBO analysis the benefit would cover 32 percent of the cost of a health insurance package equivalent to the current Medicare benefit (Figure 1). This means that the beneficiary would pay 68 percent of the cost of this package. Using the CBO assumption of 2.5 percent annual inflation, the voucher would have grown to $9,750 by 2030. This means that a Medicare type plan for someone age 65 would be $30,460 under Representative Ryan's plan, leaving seniors with a bill of $20,700. (This does not count various out of pocket medical expenditures not covered by Medicare.)

According to the Social Security trustees, the benefit for a medium wage earner who first starts collecting benefits at age 65 in 2030 would be $32,200. (This adjusts the benefit projected by the Social Security trustees [$19,652 in 2010 dollars] for the 2.5 percent annual inflation rate assumed by CBO.) For close to 70 percent of seniors, Social Security is more than half of their retirement income. Most seniors will get a benefit that is less than the medium earners benefit described here since their average earnings are less than that of a medium earner and they start collecting Social Security benefits before age 65. [CEPR.net, 4/6/11]

GOP Budget Would Raise The Retirement Age To 67, Possibly Pricing Some Seniors Out Of The Market Or Raising Health Care Prices For All Americans. According to Time magazine's Swampland blog: "Even more vexing, however, is how 65- and 66-year-olds would get coverage. Although Ryan doesn't say so in the Path to Prosperity document, which was released on Tuesday, his plan would raise the Medicare eligibility age from 65 to 67 by 2033. This would save the federal government money, but if these people shop for coverage on the open market, one of two things will happen: insurers will either price them out, or drive up prices for everyone. Again, this depends on what Ryan would propose to do with the health care law's new insurance regulations." [Time, 4/6/11]

If Medical Costs Continued To Increase Faster Than Voucher Values, "The Average Retiree Would Be More Than $50,000 In The Hole." According to an op-ed in the Huffington Post by R.J. Eskow, Senior Fellow with The Campaign For America's Future:

Even if the voucher is given full Medicare value in Year One (which we question), things start to get really bad after that. If medical costs continued to increase at 9% each year, which isn't at all impossible, and the voucher's value continued to increase at 5%, here's what would happen 10 years later using my figures:

By 2031, the cost of Medicare-equivalent coverage would be $73,000, and the voucher would be worth $18,000. By my calculation, the average retiree would be more than $50,000 in the hole. [Eskow Op-Ed, 4/6/11 via Huffington Post, emphasis original]

Republican Budget "Would Effectively Result In More Rationing On The Basis Of Income." According to the Center on Budget and Policy Priorities:

Many future Medicare beneficiaries with modest incomes, such as elderly widows who must live on $15,000 or $20,000 a year, also would likely be hit by the plan's Medicare provisions; the Medicare voucher (or defined contribution) they would receive would fall farther and farther behind health care costs - and purchase less and less coverage - with each passing year. Aggravating this problem, Ryan has said that his plan calls for repeal of a key measure of the health reform law that is designed to moderate Medicare costs - the Independent Payment Advisory Board. In other words, his plan would scrap mechanisms to slow growth in the costs of health care services that Medicare beneficiaries need, even as it cuts back the portion of those costs that Medicare would cover.

Affluent Medicare beneficiaries surely would respond to shrinking Medicare coverage over time by buying more supplemental coverage. Those who could not afford to do so, however, would get less health care. This is another way that the Ryan health care changes would make ours more of a two-tier health care system and would effectively result in more rationing on the basis of income. [CBPP.org, 4/6/11]

Politico: GOP Budget "Will Control Costs By Requiring Seniors To Ration Themselves." From Politico Pulse: "The Ryan plan to privatize Medicare will control costs by requiring seniors to ration themselves, said Michael Tanner with the Cato Institute. 'Rationing is going to go on within the Medicare system. It's a fact of life' given financial constraints, he said. 'The question's going to be, is that decision going to be made by government and imposed top down under the current system? Ryan wants to shift that responsibility to individuals and from the bottom up.'" [Politico, 4/7/11]

Once Republican Voucher Program Begins In 2022, Healthy Seniors Still On "Traditional" Medicare Would Have Incentive To Leave — Endangering The Program For Less-Healthy Beneficiaries. From the National Journal: "The policies in the House GOP budget, if enacted, would begin affecting millions of seniors almost immediately by increasing their costs for prescription drugs and probably long-term care. Further, Medicare costs could rise over time if healthier seniors choose to abandon the traditional benefit program. [...] The plan to grandfather traditional Medicare for those older than 55 could also have negative consequences for current seniors: In 2022, when the limited-subsidy program would be introduced, seniors who qualified for traditional Medicare would be allowed to switch to the new program. If healthier or younger beneficiaries make the change to lower their out-of-pocket costs, those still participating in Medicare would be part of an insurance pool that is less healthy and more expensive. To cover those higher per-person costs, Medicare might well be forced to either raise premiums or limit reimbursements to health care providers-which could prompt many to stop taking Medicare patients." [National Journal6/3/11]

"Path To Prosperity" Reopens Medicare "Doughnut Hole," Forcing Millions Of Seniors To Pay Higher Drug Costs "Immediately." From the National Journal: "[T]he GOP is doubling down on the idea that today's seniors won't be affected. That's partly true. Ryan's plan to convert Medicare into a limited insurance subsidy, the most controversial aspect of the budget, wouldn't take effect until 2022.But the proposal would also repeal last year's health care law, which means reopening a coverage gap in Medicare's prescription-drug benefit that the statute closed. The gap, commonly called the "doughnut hole," requires seniors to pay 100 percent of any prescription costs after the annual total reaches $2,840 and until it hits $4,550. Those who spend more or less have at least three-quarters of the costs covered. Under the 2010 health law, Medicare will pay 7 percent of the cost of generic drugs and 50 percent on name-brand pharmaceuticals; by 2020, the doughnut hole will be closed. If Congress were to pass Ryan's plan and repeal the law, as House Republicans want, the 3 million to 4 million seniors left in the doughnut hole each year would immediately face significant out-of-pocket costs." [National Journal6/3/11, emphasis added]

Centrist Think Tank: Despite GOP Claims, "Current Beneficiaries Are Not Protected In The Ryan Budget." According to a report from Third Way by David B. Kendall, Senior Fellow for Health and Fiscal Policy and Ryan McConaghy, Director of the Economic Program:

Despite promises to the contrary, current beneficiaries are not protected in the Ryan budget. Under the Republican proposal, traditional Medicare would quickly become second-class medicine. It would "wither on the vine," as then-House Speaker Newt Gingrich described a similar GOP effort in 1995.

The traditional Medicare plan, which covers three-fourths of today's beneficiaries, relies on its huge size to keep costs down. Doctors and hospitals are not required to participate in it, but they have little choice if they wish to treat any seniors, who are the nation's biggest health care consumers.

Fewer doctors would participate in the traditional Medicare plan if there were an alternative. The traditional plan pays physicians about 20% less than private health insurance plans. Today, that is essentially a discount for the large volume of Medicare patients. Under the Ryan budget, it would become a reason for doctors to leave the traditional plan.

By 2030, only 55% of Medicare beneficiaries would still be eligible for traditional Medicare according CBO. Actual enrollment would be less than half of Medicare beneficiaries because many seniors would continue to enroll in private health care coverage under Medicare Advantage. By 2040, traditional Medicare would have only about 20% of Medicare beneficiaries. [ThirdWay.org, 4/14/11, internal citations removed for clarity]

For Years, Republicans In Both Chambers Have Repeatedly Voted To Cut Medicare

House Republicans have voted to cut $1.02 trillion from Medicare since 1991 and Senate Republicans have voted to cut $1.31 trillion from Medicare since 1995.

House Votes

89 Republicans Voted To Cut Medicare $25.2 Billion Over Five Years. In 1991, 89 House Republicans proposed and voted for a substitute amendment to the Fiscal 1992 Budget Resolution that would have cut Medicare $25.2 billion over five years. The substitute amendment, introduced by Rep. Gradison (R-OH), was rejected. [CQ.com; H. Con. Res. 121, Vote # 70, 4/17/1991]

105 Republicans Voted To Cut Medicare $27.2 Billion Over Five Years. In 1991, 105 Republicans voted in support of a substitute amendment introduced by Rep. Kasich (R-OH) to the Fiscal 1992 Budget Resolution that would have implemented cuts in Medicare. Specifically, the substitute amendment would have "cut entitlement programs by $6.4 billion in fiscal 1992 and $48.6 billion over five years, including cuts in Medicare, totaling $27.2 billion over five years." The motion was rejected. [CQ.com; H. Con. Res. 121, Vote #69, 4/17/1991]

57 Republicans Voted To Cut Medicare And Medicaid $138.4 Billion Over Five Years. In 1992, 57 House Republicans voted for a substitute amendment to the Fiscal 1993 Budget Resolution - Spending Freeze introduced by Rep. Dannemeyer (R-CA) that would have "cut Medicare and Medicaid entitlement programs by $138.4 billion over five years." The substitute amendment was rejected. [CQ.com; H. Con. Res. 287, Vote # 38, 3/4/92]

156 Republicans Voted To Cut $34 Billion From Medicare. In 1993, 156 House Republicans voted for an "amendment to cut federal spending by $90 billion over five years through various proposals, including $34 billion in Medicare cuts, $52 billion of discretionary spending cuts and $4 billion in other entitlement cuts and user fee increases." The motion failed. [CQ.com; HR 3400, Vote #609, 11/22/93]

227 Republicans Voted Twice To Cut Medicare By $270 Billion. In October 1995, 227 Republicans voted for the misnamed Medicare Preservation Act of 1995, which cut $270 billion from Medicare over seven years.  The bill passed. In November 1995, 232 Republicans voted to adopt the conference report on the Budget Reconciliation Act of 1995, which reduced spending on Medicare by $270 billion over seven years.  The bill passed. [HR 2425, Vote #731, 10/19/95; HR 2481, Vote #812, 11/17/95]

  • 84 Republicans Voted To Cut An Additional $22.6 Billion From Medicare.  In 1995, 84 House Republicans voted for the Conservative Republican Substitute to the FY 1996 Budget Resolution.  The substitute bill would have cut Medicare by an additional $22.6 billion, on top of the $270 billion in cuts already contained in the budget.  The amendment failed.  [H.C.R. 67, Vote #343, 5/18/95]

212 Republicans Voted To Cut Medicare By $158.1 Billion.  In 1996, 212 House Republicans voted to adopt the conference report on the Fiscal Year 1997 Budget Resolution, which contained $158.1 billion in Medicare cuts over six years.  The bill passed. [H.C.R. 178, Vote #236, 6/12/96]

219 Republicans Voted To Cut $115 Billion From Medicare.  In 1997, 219 House Republicans voted for passage of the Balanced Budget Act of 1997, which "cut total projected entitlement spending over five years by about $137 billion, including a $115 billion reduction in Medicare." The bill passed. [CQ.com; HR 2015, Vote #241, 6/25/97]

206 Republicans Voted To Kill A Resolution That Sought To "Repeal Cuts In Payments To Hospitals That Serve Low-Income Patients...And Ensure Necessary Medicare And Medicaid Funding." In 2002, Rep. Sam Farr (D-CA) introduced a resolution that would "express the sense of the House that Congress should" work on legislation that would repeal cuts to health programs, including Medicare. Rep. Kenny Hulshof (R-MO) motioned to table the resolution, effectively killing it with the agreement of 206 Republican votes. The motion to table passed. [CQ.com; accessed 12/4/09; HR 854, Vote #440, 10/3/02]

208 Republicans Voted Against A Measure That Would Take Medicare Competition Savings And Put It Toward Increasing Payments To Medicare Physicians. In 2003, 208 House Republicans voted against a "motion to instruct House conferees to reject provisions of the House bill that require the traditional Medicare program to compete with private plans to provide Medicare benefits by 2010, and reject provisions of the Senate bill that establish an alternative payment system for preferred provider organizations in highly competitive regions. The savings from the rejection of these provisions would be used to increase payments to physicians for Medicare services." The motion was rejected. [CQ.com; HR 1, Vote #615, 11/6/03]

215 Republicans Voted Against Increasing Medicare Payments To Rural Hospitals. In 2003, 215 House Republicans voted against a "motion to recommit the joint resolution to the House Appropriations Committee with instructions that it be reported back with language that would continue payment rates for physician services under Medicare at fiscal 2002 levels and increase the base payment amount that hospitals in small urban and rural areas receive through Medicare to the same as that for larger urban hospitals." The motion failed. [CQ.com; H J Res 18, Vote #18, 2/5/03]

59 Republicans Voted To Cut $20 Billion From Medicare Physician Reimbursement. In 2008, 59 House Republicans voted to maintain a 10.6% scheduled cut in reimbursement rates for doctors serving patients who receive Medicare. The motion passed. [Kaiser Health News, 7/16/08; HR 6331, Vote #443, 6/24/08]

172 Republicans Voted To Cut $210 Billion From Medicare Physician Reimbursement. In 2009, 172 House Republicans voted against blocking "a 21 percent cut scheduled to take effect in January 2010, and increase the payment rate based on the Medicare economic index." The vote would have restored $210 billion in scheduled physician reimbursements. The measure failed. [Congressional Quarterly, accessed 12/4/09; New York Times, 11/19/09; HR 3961; Vote #909, 11/19/09]

Senate Votes

51 Republicans Voted To Maintain Tax Cuts For The Wealthy Instead Of Reducing Medicare Cuts By $100 Billion. In 1995, 51 Senate Republicans voted against an amendment to reduce by $100 billion the proposed cuts of $256 billion to Medicare and Medicaid by reducing tax cuts. The amendment failed 46-52. [SCR 13, Vote #173, 5/22/95]

54 Republicans Voted To Cut Medicare By $256 Billion. In 1995, 54 Senate Republicans voted to adopt the resolution to adopt a seven-year budget plan that would balance the budget by 2002 by cutting projected spending by $961 billion of which $256 billion would come from Medicare, $175 billion from Medicaid, $190 billion from non-defense discretionary spending, and $209 billion from various entitlement programs. The concurrent resolution was agreed to 57-42. [SCR 13, Vote #232, 5/25/95]

54 Republicans Voted In Favor Of Cutting $270 Billion From Medicare. In 1995, 54 Senate Republicans voted to adopt the conference report on the fiscal 1996 budget resolution to put in place a seven-year plan to balance the budget by 2002 by cutting projected spending by $894 billion, including cuts of $270 billion from Medicare, $182 billion from Medicaid, $190 billion in non-defense spending, and $175 billion from various entitlement programs such as welfare. The conference report was agreed to 54-46. [HCR 67, Vote #296, 6/29/95]

50 Republicans Voted Against Increasing Medicare Payments To Hospitals By $4.5 Billion. In 1995, 50 Senate Republicans voted against an amendment restoring $4.5 billion in payments under Medicare to hospitals that treat a disproportionate share of poor patients. The amendment failed 47-52. [S 1357, Vote #524, 10/27/95]

52 Republicans Voted To Preserve Tax Cuts For The Wealthy Instead Of Reducing Medicare Cuts By $181 Billion. In 1995, 52 Senate Republican voted against a motion reducing cuts to Medicare by $181 billion by reducing tax cuts for upper income taxpayers. The motion was rejected 46-53. [S 1357, Vote #499, 10/26/95]

51 Republicans Voted To Maintain Tax Cuts Instead Of Reducing Medicare Cuts By $100 Billion. In 1995, 51 Senate Republicans voted against an amendment to reduce by $100 billion the cuts to Medicare and Medicaid by reducing tax cuts. The amendment failed 46-52. [S.C.R. 13, Vote #173, 5/22/95]

52 Republicans Voted Against Reducing Medicare Cuts By $181 Billion In Favor Of Tax Cuts For The Wealthy. In 1995, 52 Senate Republicans voted against a motion reducing cuts to Medicare by $181 billion by reducing tax cuts for upper income taxpayers. The motion was rejected 46-53. [S. 1357, Vote #499, 10/26/95]

Republicans Cut $270 Billion From Medicare. In 1995 Senate Republicans voted in favor of a budget that would cut Medicare by $270 billion. The budget passed. [H.R. 2491, Vote #584, 11/17/1995; H.R. 2491, Vote #556, 10/27/1995; H.C.R. 67, Vote #296, 6/29/95]

  • Budget Cuts Included Reductions In Medicare, Medicare, Welfare, And Discretionary Spending.  Senate Republicans voted in favor of adopting of the conference report on the concurrent resolution to establish a six-year plan to balance the federal budget by 2002. Projected spending cuts over six years include $158.1 billion in Medicare, $72 billion from Medicaid, $53 billion from welfare and $297.9 billion from discretionary spending. The conference report passed 53-46. [HCR 178, Vote #159, 6/13/96]

53 Republicans Voted In Favor Of Cutting Medicare Nearly $160 Billion Over Six Years. In 1996, 53 Senate Republicans voted to cut Medicare by $158.1 billion over six years. First - the Senate version of the Fiscal Year 1997 Budget Resolution that contained the cut and, Second - the same cut in the conference report. Both passed 53-46. [H.C.R. 178, Vote #156, 5/23/1996; H.C.R. 178, Vote #159, 6/13/96]

50 Republicans Voted Against Increasing Medicare And Medicaid Funding By $4.1 Billion. In 2003, 50 Senate Republicans voted against a measure which would have increased funding for health care programs under Medicare and Medicaid by $4.1 billion. The motion was rejected 41-56. [HJR 2, Vote #21, 1/23/03]

49 Republicans Voted To Put Needs Of Wealthy Americans Over The Needs Of American Seniors. In 2003, 49 Senate Republicans voted against an amendment that would reduce the enormous tax cut given to the wealthiest American tax payers in order to give a fair reimbursement to rural health care providers under Medicare. The amendment failed. [SCR 23, Vote #89, 3/25/03]

51 Republicans Tabled An Amendment That Would Have Given The Sickest Seniors $12 Billion In Medicare Funding. In 2003, 52 Senate Republicans voted to table an amendment that would have allocated $12 billion for additional treatment for Medicare beneficiaries with cancer, heart disease, Alzheimer's disease and disabilities. The motion to table passed 57-41. [S. 1, Vote #253, 6/26/03]

50 Republicans Voted To Cut $5.78 Billion From Medicare. In 2005, 50 Senate Republicans voted in favor of passage of a Fiscal Year 2006 Budget Resolution that would cut $5.78 billion from Medicare. The legislation passed 52-47. [S. 1932, Vote #303, 11/3/05]

50 Republicans Voted To Cut Medicare By $6.4 Billion. In 2005, 50 Senate Republicans voted in favor of the budget reconciliation bill that cut funding for Medicare by $6.4 billion by requiring that beneficiaries purchase medical equipment and cutting payments to home health care providers. The motion passed 50-50, with Vice President Cheney casting the deciding vote. [S. 1932, Vote #363, 12/21/05]

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