U.S. To Raise Monthly Bill For Medicare

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The New York Sun

WASHINGTON — America will raise the monthly bill for most people who get basic health care through Medicare by 5.6% next year, and by as much as 83% for richer Americans.

Medicare yesterday set its first premiums scaled to income, with the top rate of $162.10 for individuals earning more than $200,000 a year.

About 96% of Medicare users will pay the lowest premium, $93.50. Medicare this year charges everyone enrolled in its routine health services $88.50 a month.

Medicare’s premium has soared since 2000, when it charged $45.50 a month for routine care, such as doctors’ visits, called Part B.

Congress and President Bush are trying to slow growth in Medicare’s cost, which could more than double to $885 billion by 2016, according to the Congressional Budget Office.

“We will be able to serve more people for a longer period if we have at least modestly more limited overall subsidies for our highest-income beneficiaries,” the administrator of the Centers for Medicare and Medicaid Services, Mark McClellan, said in a conference call.

Medicare is available for people who are disabled or 65 and older. More than 40 million of the 43 million Americans eligible for Medicare were enrolled in Part B last year, according to a government report.

About 1.5 million people will pay higher Part B premiums next year, Mr. McClellan said. A 2003 law that created the new Medicare drug benefit, known as Part D, required the scaled premiums for Part B and slated them to take effect this year.

The higher Part B premiums charged to wealthier Medicare beneficiaries may prompt about 9,000 to drop out of the program this year, and 30,000 by 2010, Mr. McClellan said.

“We expect to have very broad participation in Medicare continuing,” Mr. McClellan said. “People who might drop out temporarily are probably going to come back in and make up their premium payments when they need services.”

Federal law requires Medicare to collect about one-quarter of the cost of services, such as doctors’ visits and medical equipment used in the home, from beneficiaries.

Medicare in July said it estimated the Part B premium for 2007 would be $98.40 a month.

Medicare customers pay separately for their drug coverage through a new American drug benefit, called Part D.

The New York Sun

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