By Congressman Adrian Smith
As I have been traveling through Nebraska’s Third District during the August work period, I am reminded about the fiscal situation facing our country. I hear from Nebraskans concerned about the future of Medicare and whether it will continue to be effective in the future.
Americans are right to be worried about the future of Medicare, because without reforms, this popular program will go bankrupt in the next generation. Under current projections, Medicare Part A will run out of money in 2024, meaning if you are younger than 50 years old today, Medicare will not be able to pay for the benefits you expect - and are paying for now - by the time you are eligible for it.
The President and Democrat leaders in Congress have failed to lead on this issue and have not proposed any plan to reform Medicare’s impending bankruptcy. In fact, the President’s new health care law takes more than $700 billion from Medicare to pay for an entirely new entitlement program.
Despite the bleak outlook, there is still time to reform Medicare without affecting benefits for those 55 and older, and to ensure those 54 and younger still will have access to a health safety net when they retire. However, time is running out and waiting to address the problems would only be more difficult - and could be painful for seniors.
We must make Medicare financially viable in the future without impacting current retirees. In ten years, the House Budget Committee plan would give seniors the choice between traditional Medicare or receiving the average amount of money spent by the government on each enrollee in order to purchase private insurance.
The second option, known as premium support, would lower Medicare spending by allowing competition among providers and giving seniors the ability to select the coverage which meets their needs.
The Medicare Part D prescription drug program is evidence the premium support model will work and make Medicare sustainable. Because of the popularity of the Part D, costs have actually come in 43 percent less than originally estimated by the Congressional Budget Office due to competition and price negotiation by participating insurers.
We all agree current retirees should continue to receive the Medicare benefits they rely on. However, we also must think about the next generation. I worry about the 50-year old Nebraskan, paying into the Medicare system their entire working career, who could lose access to this program if we fail to act now.
Solving this problem requires discussion and leadership from both parties.