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Medicare Premiums to be Higher Next Year

orest are going to be the ones left behind in Medicare, and their costs are going to go up significantly to sustain the program."

Medicare officials predicted some 9,000 people to drop out of the program next year owing to the new income-based premiums, and 30,000 to leave by 2010. However they said overall, that's not a lot.

McClellan said, "I don't see any substantial adverse impacts on participation in Medicare, and I definitely see a very positive impact on making Medicare sustainable for the long term."

McClellan said that Medicare officials had been projecting an even higher increase in the standard premium, but there has been an unexpected slowing in the volume of services and tests that doctors are ordering for their Medicare patients.

According to officials the standard premium increase of 5.6 percent is the smallest since 2001. They said that it trails the projected 6 percent increase in per capita health spending next year and a projected 7 percent increase in prescription drug spending. McClellan said that average premiums in the Medicare drug benefit, known as Part D, are predicted to remain flat in 2007.

McClellan said if Congress were to repeal a planned 5.1 percent cut in Medicare payments to physicians next year the Part B standard premium would have to go up by $1.50 in 2008 (in addition to routine annual premium increases).

Kirsten Sloan, the organization's national coordinator for health said, "The fact that the premium is a little less than originally projected is good news, but . . . we may simply be forestalling higher costs to beneficiaries."


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