Medicare 101: What You Need to Know

March 27, 2015

Medicare provides health insurance coverage to 54 million people aged 65 and over and younger people with permanent disabilities. In 2013, Medicare spending accounted for 14 percent of the federal budget.

This session was especially helpful to congressional staff members new to the issue and a useful review and update for staff working on a broad range of Medicare issues. This Medicare 101 answered basic questions, such as:  What services does Medicare provide, and how does Medicare pay for these services?  How is Medicare financed? What changes did the Affordable Care Act (ACA) make to Medicare? How fast is Medicare spending growing? What are current proposals to strengthen Medicare for the future, and what are prospects for action in the new Congress?

If you were unable to attend the briefing, here are some key takeaways:
Juliette Cubanski, associate director, Program on Medicare Policy at the Kaiser Family Foundation
Medicare covers a population with significant health needs; over half of beneficiaries have four or more chronic conditions, Juliette Cubanski stated. Many of them live on modest incomes below $23,500, which is problematic because traditional Medicare doesn’t cover vision or dental services, hearing aids, most long-term services and support, and also places no limit on beneficiaries out-of-pocket spending each year, unlike typical private insurance plans, she added.

Robert Berenson, senior fellow, the Urban Institute
The Sustainable Growth Rate (SGR) was created in 1997 in order to control the volume of physician services, but since 2000 spending has exceeded targets. To avoid cutting physician fees, Congress has passed a temporary “doc-fix” 17 times, Robert Berenson explained. An SGR repeal seeks to improve payment through a consolidated, merit-based, payment incentive system, he continued.

Rahul Rajkumar, acting deputy director, Center for Medicare and Medicaid Innovation
CMMI hopes that by the end of 2016, 30 percent of Medicare fee-for-service payments will be in new alternative payment models that work, Rahul Rajkumar projected. Population-based payments that are made ahead of time to a provider responsible for a population of individuals, irrespective of the actual services provided, are the future of Medicare, he said.

Sheila Burke, adjunct lecturer in public policy, Harvard Kennedy School
Skyrocketing Medicare enrollment over the next few decades will create cost and care delivery hurdles, Sheila Burke said. By 2030, only 2.3 workers will be paying into the system per retiree, calling into question the long-term stability of the current financing model. Proposed solutions she mentioned included raising the eligibility age, alternative payment models, benefit restructuring, and Rep. Paul Ryan’s premium support plan.

Ed Howard of the Alliance for Health Reform and Tricia Neuman of the Kaiser Family Foundation will co-moderate the panel discussion.

Follow the briefing on Twitter: #Medicare101

Contact: Monica Laufer (202) 789-2300

The event was sponsored by the nonpartisan Alliance for Health Reform and The Henry J. Kaiser Family Foundation.


Full Transcript (Adobe Acrobat PDF)

Speaker Presentations

Juliette Cubanski Presentation (Adobe Acrobat PDF)
Bob Berenson Presentation (Adobe Acrobat PDF)
Rahul Rajkumar Presentation (Adobe Acrobat PDF)
Sheila Burke Presentation (Adobe Acrobat PDF)

Event Details

Agenda (Adobe Acrobat PDF)
Speaker Biographies (Adobe Acrobat PDF)

Event Resources