February 18,2000

Committee to Hold Hearing on Medicare Reform

WASHINGTON -- Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) today announced the Committee will meet on Thursday, February 24, 1999 at 10:00 a.m. in room 215 Dirksen Senate Office Building, to hear testimony on the issues and options of Medicare reform.

The following witnesses are expected to appear before the Committee:

1. A panel consisting of:

The Honorable David M. Walker, Comptroller General, General Accounting Office; Washington, D.C.

Robert D. Reischauer, Ph.D., President, Urban Institute; Washington, D.C.

II. A panel consisting of:

The Honorable Peter G. Peterson, President, Concord Coalition; Washington, D.C. (Invited)

Beatrice S. Braun, M.D., Member, Board of Directors, American Association of Retired Persons; Washington, D.C.

Robert R. Waller, M.D., President and CEO, Mayo Clinic; Rochester, MN


Medicare Program Reform: Options and Issues

On February 24, the Senate Finance Committee will reconvene on the topic of reforms to the Medicare program, including the issue of prescription drug costs for seniors. This is a continuation of the hearings that were conducted in the Committee in the first part of the 106th Congress. This hearing will focus primarily on the two most prominent reform proposals offered in recent months, including one offered by the President in the FY2001 budget submission and an alternative offered last fall by Senators Breaux and Frist. Testimony will be taken to examine the key points of comparison in order to determine where there is common ground and where these proposals differ. In addition, testimony will be taken on the work and views of external groups involved in reform ideas. The following is a snapshot of the Medicare program today and summary material on the key proposals. Later reform hearings will look at issues of health plan competition and choice, prescription drug coverage and federal management of the Medicare program.

In 1998, Medicare Hospital Insurance (HI or Part A) covered over 38.4 million beneficiaries, approximately 5 million of whom were disabled. The remainder, 33.4 million, were elderly. Of these elderly beneficiaries, 54% are between 65-74 years of age, 34% between 75 and 84 years, and 12% older than 85 years. CBO estimates that in 2000 39.3 million persons will be enrolled in Part A. End-Stage Renal Disease (ESRD - kidney failure) patients are eligible for Medicare Part A at any age, subject to certain requirements. In 1996 there were approximately 290,000 Medicare beneficiaries with ESRD.

In 1998 36.7 million persons are enrolled in the Medicare Supplemental Medical Insurance (SMI or Part B) program, 32.3 million are elderly and the remaining 4.4 million are disabled. CBO estimates that in 2000 37.3 million will be enrolled in Part B.

Currently, about one in seven Americans is enrolled in the Medicare program. CBO estimates that approximately 46 million people will be enrolled in Medicare by 2010, and by 2030, this number is expected to grow to one in five or 76 million enrollees. Annual growth in enrollment is also expected to rise from 1.1% a year currently to 2.0% in 2010. These changes will stress the structure and benefits of the current program, leading many to urge the Congress to take steps now in anticipation of these future demands.