Medicare Premium Increase Looms As House Negotiations Stall

Millions of Americans could see their Medicare premiums spike by 52 percent next year if congressional leaders fail to reach a deal in coming weeks. The surge -- the largest in the social insurance program's history -- would hurt senior citizens and drain state budgets, the Hill reported Sunday.

Talks between House Republican and Democratic leaders were at a standstill this weekend after nearly a month of meetings. Despite initial optimism, any lingering hope policymakers would reach an agreement by year's end is fading fast, the Hill said.

The potential spike is the result of a quirk in federal Social Security laws. In the years the government doesn't approve an annual cost-of-living increase, Medicare enrollees face higher premium costs if they aren't protected by Social Security's "hold harmless" clause. The provision benefits Medicare recipients who have their premiums deducted from their monthly Social Security checks.

The Obama administration confirmed last week there would be no 2016 cost-of-living increase. That's potentially bad news for people not protected by the clause, including seniors who turn 65 next year and those who are on Medicare but do not yet receive Social Security benefits. The majority of these enrollees, about 8 million people, are projected to pay monthly premiums of $159.30, up from about $105 this year.

"If you don't have a fat retirement account, you constantly have to adjust things, and increases make it painful," Bob Baker, 84, told San Diego Union-Tribune newspaper Saturday. Citing the premiums, he said he planned to rely on his benefits through the U.S. Department of Veterans Affairs, even though enrolling in Medicare would give him broader access to medical services.

The Hill said House Minority Leader Nancy Pelosi, D-Calif., initially raised the premium issue in a Sept. 17 meeting with House Speaker John Boehner, R-Ohio. The Democratic leader had hoped to reach a deal by last week before the White House announced there wouldn't be a cost-of-living increase.

In the days since the deadline passed, Pelosi has ramped up her criticism of Boehner and other Republican leaders. She urged the GOP-controlled Congress to present a bill that could sidestep the premium spike. "We know what needs to be done, but Republicans have failed to act,” she said in a statement Thursday.

Both Republicans and Democrats agreed the biggest sticking point in the Medicare talks was how to pay for the bill, which is estimated to cost as much as $7.5 billion. A House GOP leadership aide told the Hill Boehner will not consider a package that is not fully funded. Democrats have kept quiet about what funding options are being considered.

White House spokesman Josh Earnest gave reporters few details about how the Obama administration planned to address the problem. At a press conference Thursday, he said only the administration is aware of and concerned about the “unintended policy consequence,” the Hill noted.