A large portion of Medicare recipients and individual States should ready themselves for what should not be all that shocking: Obamacare didn’t bend the cost curve down – at all. Medicare premiums for 2012 are set to rise to $113.80 per month, an almost 20% increase over the $94.60 2011 premiums, which will hit fixed-income earners and cash-strapped States with an increasing burden.
Social Security recipients will be the first hit. As an Associated Press wire reported, the first COLA increase in years will likely be wiped out by increasing health care premiums.
“The government is projecting a slight cost-of-living adjustment for Social Security benefits next year, the first increase since 2009. But for most beneficiaries, rising Medicare premiums threaten to wipe out any increase in payments, leaving them without a raise for a third straight year.”
Secondly, those low-income earners on Medicaid will not be hit with the increasing premium – it will instead be passed on to the state providing the Medicaid. This will cause a pass-thru cost to state income and sales tax payers. As almost all states are facing tremendous shortfalls due to entitlement mismanagement such as this, more and more costs will be passed on to taxpayers and more services will have to be cut to avoid default.
In 2010, Medicare premiums were the same as they were in 2009. All this before Obama’s health care reform was passed. Now that we’ve had more than a year of liberal health care planning and management, a 20% increase in premiums comes due and Donald McLeod from the Center for Medicare and Medicaid Services hinted that even the Obama administration wasn’t prepared for the increase. Mr. McLeod pointed out that the President’s budget projected Medicare premiums to be $108.20, not the $113.80 that CMS expects.