NEWS FLASH

Obama’s Deficit Plan Expands Means Testing In Medicare | The 2003 Medicare Modernization Act introduced means testing into the Medicare program and required individual seniors with a Modified Adjusted Gross Income (MAGI) of more than $85,000 or couples earning more than $170,000 to pay more for their Medicare Part B and Part D premiums. Currently, less than 5 percent of the Medicare population falls into this criteria. Beginning in 2017, Obama’s deficit plan would freeze the MAGI levels until 25 percent of all Medicare beneficiaries are required to pay cost-sharing and he would increase their premiums by an additional 15 percent. Beneficiary groups and the AARP are protesting the change and as Jonathan Cohn explains, it’s not necessarily the greatest policy, but is a far cry from the kind of cost shifts Republicans are proposing. “In general, social insurance programs thrive when they are universal and suffer when they target the poor disproportionately,” he writes. “Asking the most affluent 25 percent of seniors to pay modestly higher premiums isn’t the same as turning the whole program into welfare (or, to use the proper analogy, Medicaid). And it may well be the best alternative under these circumstances. But every time the program becomes less universal it also becomes more vulnerable politically.”