AP NEWS

Gov. Baker proposes expanding Medicare savings program

January 19, 2019

BOSTON (AP) — Low-income seniors would see a break on how much they pay for health care under a plan Republican Gov. Charlie Baker is including in his state budget proposal.

Under the plan, seniors who earn 130 to 165 percent of the federal poverty level — from just under $16,000 to about $20,000 each year — would be eligible for Medicare savings programs, which help reduce health care expenses, including out-of-pocket costs.

Currently seniors earning from 100 to 135 percent of the federal poverty level — from just over $12,100 to $16,400 — are eligible for the savings programs, which also help cover hospital and general medical services. They also automatically qualify for help with prescription drug coverage.

Baker’s budget would set aside about $10 million in state dollars for the expansion, which would leverage about $100 million in additional federal Medicare dollars for nearly 40,000 seniors — 25,000 of whom are currently not eligible.

“This will make a big difference to a lot of people,” Baker said Friday.

The administration said the change would reduce eligible seniors’ out-of-pocket expenses by thousands of dollars a year and help ease what they described as the health care cost “cliff” low income seniors face when they turn 65.

Administration officials said a 79-year-old individual with $17,000 in social security income would see a drop in annual out-of-pocket costs from $6,000 to $600 — or from about 36 percent of their income to about three percent.

Baker is scheduled to file his roughly $42 billion state budget proposal with lawmakers on Wednesday. The new fiscal year begins July 1.

Baker’s budget proposal is the first step in a long process. The House and Senate must still come up with their own versions and approve with a final, compromise spending plan to send to Baker before the end of June.

Senior advocates have pushed for the change. Currently about one in three low income seniors in Massachusetts spend more than 20 percent of their income on health care.

Massachusetts isn’t the first state to take the step. Administration officials say 13 other states have taken similar steps to expand eligibility under Medicare savings programs.

If approved by lawmakers, it would be the first time Massachusetts has adjusted eligibility levels beyond the federal standards since the program was created in 1966.