Doctor concerned with health care law

Breaking news and expert analysis on legal and compliance issues

[Back To Home][Back To Archives]

From Health Law Daily, October 28, 2015

Budget deal would shield Part B premiums, spike ACA requirement

By Anthony H. Nguyen, J.D.

Congressional leaders and the White House have struck a deal to raise the nation’s debt limit and have agreed to spending targets for the federal budget for the next two fiscal years. Under the tentative budget agreement, Medicare premiums for the coming year will not drastically increase as anticipated, but will nevertheless require nearly one in three older Americans to pay 17 percent more in monthly premiums for doctors’ visits and other outpatient care. In addition to Medicare premiums, the budget agreement would eliminate an employee automatic enrollment requirement under the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) for large employers.

Part B premiums. In the draft “Bipartisan Budget Act of 2015,” Medicare’s Part B premiums for this group of roughly 15 million people will increase from the current rate of $104.90 per month to $120 per month next year, plus a $3 surcharge. After holding level since 2013, the monthly premiums for these people would have jumped to nearly $160 without the legislative adjustment. Federal officials noted that the adjustment is applicable to an estimated 30 percent of the 52 million older Americans expected next year to participate in Medicare’s Part B, which covers health care services outside hospitals.

The jump in Part B premiums is set to occur because, for these individuals because under federal rules, insurance premiums are not automatically subtracted from their Social Security check. Among this group are people: (1) who do not collect Social Security; (2) enrolling in Part B for the first time in 2016; (3) with incomes that trigger higher premium charges; or (4) poor enough to also qualify for Medicaid. To protect older individuals, Medicare rates in a given year cannot increase more rapidly than their Social Security checks. However, with low inflation, the government announced that for the third time in the past several years Social Security benefits would not increase in 2016. As a consequence, for individuals who do not have Part B premiums withdrawn from their Social Security checks, the spike was needed to keep Medicare in actuarial balance.

In order to moderate the Part B premium increase, the government would lend money from the U.S. Treasury to the Medicare funds. The $3 per month surcharge will be used to pay back the loan. The AARP (American Association of Retired Persons) favored the budget deal, urging members of the House and Senate to support the bipartisan budget agreement.

Large employers under ACA. In a separate health care related section of the budget agreement, large employers with more than 200 full-time employees that offer job-based health insurance plans would not be required to automatically enroll their employees in a health insurance plan within three months of hiring as required by Section 1511 of the ACA. Under the requirement, employees would have the right to decline coverage or select alternative policies, but in an opt-out manner rather than opt-in. There was pushback from both sides of the political spectrum with concerns about difficulty of implementation or monetary impact on low-wage employees.

MainStory: TopStory NewsStory GeneralNews HealthCareReformNews HouseNews CMSNews PartBNews SenateNews

Back to Top

Health Law Daily

Introducing Wolters Kluwer Health Law Daily — a daily reporting service created by attorneys, for attorneys — providing same-day coverage of breaking news, court decisions, legislation, and regulatory activity.


A complete daily report of the news that affects your world

  • View full summaries of federal and state court decisions.
  • Access full text of legislative and regulatory developments.
  • Customize your daily email by topic and/or jurisdiction.
  • Search archives for stories of interest.

Not just news — the right news

  • Get expert analysis written by subject matter specialists—created by attorneys for attorneys.
  • Track law firms and organizations in the headlines with our new “Who’s in the News” feature.
  • Promote your firm with our new reprint policy.

24/7 access for a 24/7 world

  • Forward information with special copyright permissions, encouraging collaboration between counsel and colleagues.
  • Save time with mobile apps for your BlackBerry, iPhone, iPad, Android, or Kindle.
  • Access all links from any mobile device without being prompted for user name and password.