HEARING - U.S. Senate Special Committee on Aging

-U-
59
not only helps relieve political pressure to expand govern.ent financing of
long term care, but promises to be one of the truly promising ways to promote
IlO range financial plannring helpful to the develop of an insurance market
tar a long term care Insurance product.
In short, ODEFRA's tax provisions on prefiring retiree benefits is
causing e!nloyers to curtail the fluding of retiree health benefits. I urge
Congress to examine this issue.
FROPOSALS FO RESTRICTLRING MEDICARE
Various proposals have been advanced to expano or restructure the Medicare
program. In assessing this issue, the HIAA feels that various problems under
the Medicare program should be prioritized.
The first priority of Congress should be to ensure the adequate financing
of current Medicare benefits. Next, Congress should reinstate originally
promised benefits and provide sufficient furding. Both efforts will entail
hard decisions regarding who should bear this Cost. That Medicare no longer
provides for originally promised acute care coverage is apparent in the fact
that in the last ten years, hospital inpatient coverage has decreased from 75%
to 6% of charges, while Part B coverage has dropped from 65% to about 57% of
charges. Further, Medicare extended care benefits cover only a of all
nursing home costs. Returning Medicare benefits to original levels Will cost
billions of dollars. This revenue should be found before Congress exacerbates
the above-nentioned problems still further by adding new benfits.