08.05.10

Cantwell Cites New Report that Health Care Reform Law Improves Outlook for Medicare

New report says crucial Medicare fund expected to remain solvent 12 years longer than projected before reform

WASHINGTON, DC – Today, Senator Maria Cantwell (D-WA) said a new report concludes that changes in the Patient Protection and Affordable Care Act have improved the solvency of Medicare significantly. The annual report was released today by the Medicare and Social Security Boards of Trustees on the fiscal solvency of the two Medicare Trust Funds: the Hospital Insurance (HI) Trust Fund and the Supplementary Medical Insurance (SMI) Trust Fund. According to the report, the HI Trust Fund is now expected to remain solvent until 2029 – 12 years longer than projected last year before passage of the health care reform bill.
 
“Today’s report makes clear that this year’s historic health care reform law achieved one of its key goals, controlling the runaway costs of Medicare and the entire health care system,” Senator Maria Cantwell said. “Improved Medicare solvency is critically important, and the new Medicare reimbursement formula I authored will further improve access to Medicare providers by finally rewarding Washington doctors for the low-cost, quality care they’ve provided for so long. The old system rewarded quantity – even in cases where services or prescriptions weren’t needed.”
 
The report also states that Part B of SMI, which pays for doctors’ bills and other outpatient expenses, and Part D, which pays for prescription drug coverage, are both projected to remain solvent into the indefinite future. 
 
Cantwell, a member of the Senate Finance Committee that played a major role in crafting the health care reform law, authored the new Medicare reimbursement formula that rewards quality of care instead of quantity of services. Beginning in 2011, Cantwell’s “value-based index” will gradually be implemented, with full implementation by 2017. The index replaces the previous system that rewarded practitioners for ordering often redundant or unnecessary tests and procedures, contributing to an estimated $120 billion per year in unnecessary spending. The average yearly cost for a Medicare patient in Washington state before health care reform was $7,100, roughly $1,200 less than the national average, with thirty-four states having higher per-person Medicare costs than Washington. The value-based index will particularly benefit Washington state patients and providers by ending Medicare’s practice of paying more to high-cost states. 
 
Click here to access a fact sheet from the Centers for Medicare and Medicaid on the Medicare Trustees Report released today.
 
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