House Passes Bill To Protect Federal Retirees From The 2010 Medicare Premium Increase

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By MyFederalRetirement
Posted: 09-29-2009


September 28, 2009

Last week, the House of Representatives passed the Medicare Premium Fairness Act. ( H.R. 3631). The bill would protect all Medicare beneficiaries -- including federal civil service annuitants who are not eligible to receive Social Security -- from an increase in their Part B premium in 2010 when they are unlikely to receive any cost-of-living adjustment (COLA).

"This bill is about equity for all Medicare beneficiaries, because without it, federal, state and local government retirees who are not Social Security-eligible would have to pay the Part B rate hike in a no-COLA year, while Social Security beneficiaries would not," said Margaret L. Baptiste, president of the National Active and Retired Federal Employees Association (NARFE).

Current projections indicate no COLA will be paid to Social Security beneficiaries and federal civilian and military retirees in 2010, and the Congressional Budget Office (CBO) has predicted the possibility of no COLA for 2011 and 2012. Under present federal law, about 75 percent of Medicare beneficiaries are not required to pay -- or are "held harmless" -- for the increase in Part B premiums in any year when they receive no Social Security COLA.

However, according to NARFE, there are four groups of older Americans who are not protected by the "hold harmless" provision, including over a million federal, state and local government retirees who are not eligible to receive Social Security benefits.

Absent a change in law, they would not only have to pay the higher Part B premiums without a COLA, but also absorb the costs of other Medicare beneficiaries currently 'held harmless.' NARFE stated.

The House-approved bill would shield all older Americans from the Part B premium increase in 2010, including government retirees who are not eligible for Social Security. That means no one would pay the Part B increase next year. The legislation is fully financed through the Medicare Improvement Fund.

"NARFE has worked tirelessly behind the scenes on this legislation for the past three months," added Baptiste, "and we are gratified to win equity for all federal annuitants."

Posted with Permission from: MyFederalRetirement.com