Privatized Medicare ups premiums, study says
WASHINGTON – Nearly six in 10 Medicare recipients would pay higher premiums under a hypothetical privatized system along the lines of what Republican presidential candidate Mitt Romney has proposed, according to a study released Monday.
The report by the nonpartisan Kaiser Family Foundation also found striking regional differences that could lead to big premium hikes in some states and counties.
In Florida, the hypothetical plan modeled by Kaiser would boost premiums for traditional Medicare by more than $200 a month on average. In Nevada, 50 percent of seniors would face additional monthly premiums of $100 or more for their coverage. A new pattern of regional disparities would emerge from overhauling Medicare’s payment system, the report said.
Romney and his running mate have proposed changing Medicare to a “premium support” system dominated by private plans that are paid a fixed amount by the government. President Barack Obama says replacing the current open-ended Medicare benefit would shift costs to seniors.
Romney’s approach would mirror the difference between traditional workplace pensions and modern-day 401(k) plans, in which the employer contribution is limited. While Medicare financing wouldn’t be as heavy a lift for taxpayers, the risk is that retirees could end up paying more if medical costs rise.
The study carried a prominent disclaimer: It should not be taken as a specific analysis of the Romney proposal, partly because that plan lacks details. However, Kaiser says it is modeled on what Romney proposes.