Medicare Reform

Wednesday, August 4, 2010 - 8:00pm


All employers and employees fund the Medicare program through payroll and income taxes, and therefore have a common interest in ensuring the viability of the program for current and future beneficiaries. The U.S. Chamber of Commerce, along with its allies in the Employers' Coalition on Medicare, strongly supported the passage of the Medicare Modernization Act of 2003. The Medicare program needed to be improved with new emphasis on quality care, preventive care, and disease management through the development of a new prescription drug benefit. In advocating for this, the Chamber worked hard to ensure the new Medicare law did not include additional mandates.

The Chamber supported three main principles during the Medicare Modernization Act debate. First, any change in Medicare needed to be linked to reform. A drug benefit needed to be established in the context of comprehensive reform of the Medicare program. The government, as a large purchaser of health care services, had to make fundamental changes to Medicare, starting with the three key areas:

  1. Plan design and delivery
  2. Reimbursements and payment to providers
  3. Information sharing and disclosure

The second principle the Chamber believed was key to Medicare reform was universal access to prescription drugs. The third principle the Chamber stressed in the Medicare debate was that the government should provide flexible options for employers and beneficiaries. Medicare should be primary, but it ought to allow employers and beneficiaries the option of supplementing Medicare coverage without penalty or additional financial liability. Employers and Medicare beneficiaries should have several options for obtaining affordable health coverage including prescription drugs and should be allowed to fund retiree health care needs on a tax-preferred basis. Different employers and individuals necessarily will elect options that best serve their unique needs and circumstances; no single option or set of options should be mandated for employers or individuals.

The Chamber has continued to advocate for logical regulations as the Medicare Modernization Act is being implemented. We submitted comments that stressed the need for the Centers for Medicare and Medicaid Services (CMS) to release the Medicare Part D regulations in a timely manner and to clarify certain troubling aspects of the original proposed regulations. CMS published the final Medicare Part D Prescription Drug Regulations in mid January, 2005 and incorporated many of the Chamber's comments. Employers choosing to provide retirees with a prescription drug benefit now will have four different options to help them continue to afford to do so beginning in January 2006.