Print Friendly, PDF & Email

One year ago, on March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act, the Health Care Reform law[1] that will provide access to health insurance for virtually all Americans.

As the Center for Medicare Advocacy has reported over the past year, Health Care Reform is good for Medicare, good for families, and good for the country. Health Care Reform does not cut Medicare benefits. In fact, Health Care Reform expands Medicare coverage, by eliminating cost-sharing for preventive services, adding a yearly Wellness Visit, limiting some cost-sharing in private Medicare plans, and closing the Part D "Donut Hole."  It also improves the solvency of the Medicare program itself, while helping reduce the deficit and creating 260,000 new jobs for Americans.[2]

Even one year after passage of the historic law, misstated reports of these changes continue to encourage public fear of cuts to Medicare benefits.

Threats to Medicare, including benefit cuts and the dismantling of the Medicare program, are real, but they do not come from Health Care Reform.  The biggest threats to Medicare are from deficit reduction proposals[3] and the repeal of Health Care Reform, not from the Health Care Reform law itself.  The proposals that threaten Medicare are often made by the same policy-makers who decried Health Care Reform as hurting, not helping, Medicare and Medicare beneficiaries.  One year after enactment of Health Care Reform, it is these purported deficit reduction proposals that, if enacted, would cause the sweeping changes to Medicare that are often wrongly attributed to Health Care Reform.

The chart belowcompares Health Care Reform, deficit reduction proposals, and repeal efforts and their effect on the Medicare program.


Health Care Reform

Deficit Reduction Proposals

Repeal of Health Care Reform

Deficit Reduction

Reduces deficit by $1.2 trillion over twenty years. [4]

Do not address the issue of sharply rising health care costs in the private sector, which are reflected in the costs to the federal government.[5]

Adds $230 billion to the deficit[6]


Medicare Solvency

Extends Medicare Part A Trust Fund solvency by 12 years to 2029. [7]

Do nothing to promote Medicare solvency. 

Eliminates cost-savings, including development of new delivery systems, that promote Part A Trust Fund solvency.

Protects Medicare's Guaranteed Benefits

"Nothing in the provisions of, or amendments made by, this Act shall result in a reduction of guaranteed benefits under title XVIII of the Social Security Act [the Medicare title]" Additionally, "Nothing in this Act shall result in the reduction or elimination of any benefits guaranteed by law to participants in Medicare Advantage plans."[8]

Eliminate Medicare as we know it by turning Medicare into a voucher program. There would be no guaranteed benefit package, and beneficiaries would face less extensive coverage or pay higher premiums than under the current system.[9]

Increases the vulnerability of the Medicare Trust Fund, leading to a corresponding threat to beneficiaries' guaranteed benefits.

Medicare Eligibility

Medicare eligibility is not changed.  Most people are eligible at age 65.

Increase the age of Medicare eligibility to 67. [10]

If Health Care Reform is repealed and the age of eligibility is increased, people between ages 65 and 67 who would otherwise have had Medicare coverage would be uninsured.[11]

Medicare Cost-Sharing

Reduces cost-sharing by:

1) Eliminating co-insurance and deductibles for most preventive services;

2) Closing the Part D prescription drug donut hole; and

3) Prohibiting Medicare Advantage plans from charging more than traditional Medicare for costly services.[12]

Increase cost-sharing by:

1) Increasing deductibles and coinsurance for Parts A and B through a combined deductible and 20% coinsurance for all further costs; [13]

2) Adding a co-payment for home health services;[14]

3) Changing Medigap (Medicare supplemental) insurance so that beneficiaries would have to pay a co-payment for all services.[15]

These proposed increases in cost-sharing would most affect poor and sick beneficiaries, leaving them with higher costs and less access to the care they need.[16]

Reinstates cost-sharing for preventive services and reopen the "Donut Hole," ensuring higher out-of-pocket costs.  Some beneficiaries would forego preventive care and stop taking their medicine.

Medicare Premiums

Freezes the income level at which beneficiaries with higher incomes pay more for Part B; requires beneficiaries with higher incomes to pay more for Part D.[17]

Requires ALL Medicare beneficiaries to pay higher Part B premiums, in addition to the extra premiums that people with higher incomes pay for Part B and Part D. Some proposals would increase Part B and D premiums by 30% by 2021.[18]

Rescinds freeze on income levels for increased premiums.

Fraud, Waste, and Abuse

Targets fraud, waste, and abuse in Medicare by:

1) Eliminating overpayments to Medicare Advantage plans.[19]

2) Implementing stricter screening procedures and billing procedures on Medicare providers and suppliers;

3) Appropriating additional funds[20]

Do not address fraud, waste, and abuse.

Eliminates programs that target fraud and abuse, and reinstates wasteful Medicare Advantage overpayments.[21]

Coordination of Care and Improved Quality

Adds specific programs to improve quality of care.  For example: payment reforms; auditing unnecessary hospital admissions and hospital acquired conditions; promoting programs to improve care coordination, particularly for beneficiaries with complex health conditions; improving quality measures and quality reporting.[22]

Apply across-the-board payment cuts and do not seek to reduce costs by improving care coordination or quality of care. 

Eliminate programs that seek to coordinate care and improve quality for beneficiaries.

Promotion of Health Care Delivery System Reforms

Creates the Center for Medicare & Medicaid Innovations (CMMI) to promote delivery systems that improve care and reduce costs, creates Medical Home and Accountable Care Organization models to improve care for people with multiple chronic conditions.[23]

Eliminate funding for CMMI and for innovative delivery system models without alternative delivery system reforms to address high costs.

Eliminates authority and funding for delivery system innovations, including for CMMI, thereby eliminating opportunities to find solutions to the growth in health care costs.

Protection for People Dually Eligible for Medicare and Medicaid (Dual Eligibles)

Creates the Federal Office of Coordinated Health Care to improve access to care for dual eligibles;[24] improves access to benchmark Part D drug plans for people eligible for the Part D low-income subsidy.[25]

Turn Medicaid into a block grant program, thereby providing less or no assistance to people with limited incomes and resources, including people who need long-term care.[26]

Reverses the creation of critical initiatives to improve access and navigation through the health system for vulnerable dual eligibles.



Enactment of the Health Care Reform law has improved the lives of the millions of Americans and their families who count on Medicare for their health insurance coverage. The law ensures future generations will have access to benefits by strengthening the Medicare trust fund and by supporting delivery system reforms that will help reduce the growth in health care costs.  Health Care Reform promotes health and wellness for beneficiaries by emphasizing prevention, quality, and care coordination. Health Care Reform also benefits the families of Medicare beneficiaries by extending access to health insurance coverage to millions of uninsured individuals, and by protecting everyone against insurance company practices that deny health insurance coverage to people when they need it.

Efforts to eliminate Health Care Reform and deficit reduction proposals are dangerous threats to Medicare and harmful to its most vulnerable beneficiaries.  They shift the burden of rising health care costs to Medicare beneficiaries, who do not have the means to absorb these costs, while ignoring the real culprit of skyrocketing overall costs in the private market. If passed, repeal of health care reform and deficit reduction proposals will result in substantial cuts to Medicare; cuts that will be felt most by women, sick beneficiaries, and poorer beneficiaries already paying high out-of-pocket costs.

Simply put, Health Care Reform is good for Medicare, families, and taxpayers.  Medicare beneficiaries and their families should celebrate the first anniversary of the Patient Protection and Affordable Care Act, and should work hard to ensure that its provisions are fully implemented.


[1]  Health Care Reform consists of two separate laws, the Patient Protection and Affordability Care Act of 2010 (PPACA), Pub.L. 111-148  (March 23, 2010),  and the Health Care and Education Reconciliation Act of 2010 (HCERA), Pub. L. 111-152 (March 30, 2010).  The laws often are collectively referred to as the Affordable Care Act (ACA).
[2] "The Employment Situation." Economic News Release. U.S. Bureau of Labor Statistics,
[3] For a comparison of the various deficit reduction proposals, see, Kaiser Family Foundation, Comparison of Medicare Provisions in Deficit Reduction Proposals  (January 2011),
[4] "Preliminary Analysis of the President’s Budget for 2012," March 18, 2011,
[5] Even before enactment of health care reform, experts argued that lowering spending growth in Medicare is only possible if lower spending growth is reflected in the private sector. Gail Wilensky, "The Challenge of Medicare," in Restoring Fiscal Sanity 2007: The Health Spending Challenge, Brookings Institution Press, 2007.
[6] Congressional Budget Office, H.R. 2, Repealing the Job-Killing Health Care Law Act. Feb 18, 2011, available at:
[7] "2010 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds," August 5, 2010,
[8] PPACA §§ 3601, 3602.
[9] Douglas W. Elmendorf, Director, Congressional Budget Office, Letter to the Honorable Paul D. Ryan, November 17, 2010,; Paul N. Van de Water, Ryan-Rivlin Plan Would End Guaranteed Medicare, Shift Medicaid Costs To States And Beneficiaries(Center on Budget and Policy Priorities, March 17, 2011),
[10] Ryan-Rivlin Plan Would End Guaranteed Medicare, Shift Medicaid Costs to States and Beneficiaries, supra.
[11] Ibid.
[12] PPACA §§ 3203,3301, 3315 4103, 4104, HCERA § 1101,amending 42 U.S.C. §§1395l(a)(1),  1395w-22(a)(1)(B); and adding  42 U.S.C. §1395w-114A.
[13] Alice Rivlin and Paul Ryan, A Long-Term Plan for Medicare and Medicaid, November 17, 2010, available at
[14] Medicare Payment Advisory Committee, Report to the Congress:  Medicare Payment Policy, Chapter 8 (March 2011)
[15] Report of the National Commission on Fiscal Responsibility and Reform, The Moment of Truth, December 2010.
[16] Ryan-Rivlin Plan Would End Guaranteed Medicare, Shift Medicaid Costs to States and Beneficiaries, supra.
[17] PPACA §§ 3308, 3402, amending 42 U.S.C. §§ 1395r(i), 1395w-113(a).
[18] Center for American Progress, "Higher Tolls on the Roadmap", February 15, 2011, available at
[19] HCERA §§ 1102, amending 42 U.S.C. §1395w-23.
[20] PPACA, §§ 6401-6411, HCERA § 1304.
[21] Congressional Budget Office, H.R. 2, Repealing the Job-Killing Health Care Law Act, supra.
[22] PPACA §§ 3001-3015.
[23] PPACA §§ 3021, 3022, adding 42 U.S.C §§ 1315a, 1395jjj.
[24] PPACA § 2602, adding 42 U.S.C. § 1315b.
[25]  PPACA §§ 3302, 3303,amending 42 U.S.C. §§ 1395w-114(a),(b).
[26] Edwin Park, Matt Broaddus, Medicaid Block Grant Would Shift Financial Risks and Costs to States, (Center for Budget and Policy Priorities, February 23, 2011)

Comments are closed.