Today, President Bush “vetoed the Medicare bill that would stave off a 10.6 percent cut in reimbursements to doctors and replace it with a slight increase.” In his veto statement, Bush claimed that the legislation, which made cuts to the Medicare Advantage program, “would reduce benefits to millions of seniors, including lower-income seniors, who have chosen to join these plans“:
While the MMA increased the availability of private plan options across the country, it is important to remember that a significant number of beneficiaries who have chosen these options earn lower incomes. The latest data show that 49 percent of beneficiaries enrolled in MA plans report income of $20,000 or less. These beneficiaries have made a decision to maximize their Medicare and supplemental benefits through the MA program, in part because of their economic situation. Cuts to MA plan payments required by this legislation would reduce benefits to millions of seniors, including lower-income seniors, who have chosen to join these plans.
In fact, the bill Bush vetoed actually “helps low-income beneficiaries pay the costs of Medicare benefits” by increasing “the amount of assets that applicants are able possess and still qualify for the Medicare Savings Program.”
Bush’s argument that low income Americans benefit disproportionately from Medicare Advantage plans echoes the now discredited analysis of AHIP, the health insurance lobby. As the Center for Budget and Policy Priorities points out, this claim is “based on misleading use of data“:
– “The Administration notes that about 49 percent of Medicare Advantage enrollees have incomes below $20,000, but generally fails to point out that 51 percent of fee-for-service beneficiaries do.”
– Nearly half (48 percent) of all Medicare beneficiaries with incomes below $10,000 are enrolled in, and thus receive supplemental coverage through, Medicaid. This is nearly five times the proportion (10 percent) who are enrolled in Medicare Advantage plans.
– Among beneficiaries with incomes below $20,000… a larger share receive supplemental coverage through Medicaid than through a Medicare Advantage plan”
Thus, Bush’s veto undermines the health care coverage for “low-income seniors” in the name of saving it.
UPDATE: The House of Representatives voted 383 to 41 to override Bush’s veto.