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Democrats’ H.R. 3200 Disproportionately Harms Low-Income and Minority Seniors

September 17, 2009

Democrats have repeatedly pledged H.R. 3200 will expand insurance options and preserve Americans’ ability to keep the insurance they have and like.  However, as previously detailed, a total of 6 million seniors will be denied access to an affordable Medicare Advantage (MA) plan because of H.R. 3200, including 3 million seniors who will lose the plan they currently have.  According to a new analysis those seniors will be disproportionately low-income and minority seniors.  Here are the facts:

  • Seniors enrolled in MA have lower incomes than the average senior in Medicare.  
    • 47% of MA enrollees have incomes below $20,000.
    • Only 6% of MA enrollees have incomes above $50,000. 
  • Hispanic and African-American seniors are most likely to choose MA over the traditional Medicare program.  
    • 1 in 3 Hispanic seniors are enrolled in MA.
    • 1 in 4 African-Americans seniors are enrolled in MA.
    • 1 in 5 White seniors are enrolled in MA.
    • 1 in 6 Asian-Americans are enrolled in MA.

Higher enrollment in MA by low-income and minority seniors is due in part to the fact these seniors are less likely to have employer-based coverage to supplement to traditional Medicare.  Low-income seniors are also less likely to be able to afford Medicare supplemental policies (Medigap) to help reduce their Medicare out-of-pocket costs and provide them with extra benefits.

The additional benefits these seniors currently receive in MA plans include protections against high out-of-pocket costs, vision and dental coverage, and free preventive care and cancer screenings.  For example, in 2007, 100% of seniors in an MA plan had coverage for physical examinations, 88% had vision benefits, and 57% had hearing benefits – all of which were not covered by traditional Medicare.  Additionally, in 2007, 93% of seniors had the option of choosing an MA plan that capped out-of-pocket costs at $2,500, a financial security protection traditional Medicare doesn’t afford.  MedPAC predicts that the value of additional benefits will be slashed by $252 per year.  If H.R. 3200 is enacted, it will be especially burdensome for low-income seniors who are enrolled in MA plans.

So much for being able to keep what you like.