By Alexander Bolton - 09/28/11 05:27 PM EDT
Sens. Joe Lieberman (I-Conn.) and Tom Coburn (R-Okla.) are pressing the deficit-reduction supercommittee to consider their proposal to cut more than $500 billion in Medicare spending over 10 years.
Lieberman’s support for Medicare reform is significant because he caucuses with Democrats and holds sway with centrist senators such as Susan Collins (R-Maine) and Ben Nelson (D-Neb.).
“Federal spending for Medicare and Medicaid has accounted for a sharply rising share of the federal budget over the last decade, making it clear that it will be virtually impossible to balance our country’s finances without bringing the costs of these programs under control,” the lawmakers wrote in a letter Wednesday to the 12 members of the supercommittee.
They urged the panel to review the Medicare reform plan they released in June.
It would increase the share that beneficiaries pay into the program to account for 35 percent, instead of 25 percent, of Medicare revenues. It would also require higher income earners to pay a greater share of Medicare Part B, which covers doctors’ visits, and Part D, which covers prescription drugs.
Lieberman and Coburn would require people 65 and older who make more than $150,000 annually to pay the full cost of Part B coverage, and full premium costs for Part D.
“The facts are clear, something must be done to reform Medicare or it will bankrupt the federal government and take America’s finances down with it,” they wrote.
They argued their plan would “address many of the imminent fiscal dangers facing the Medicare program.”
The Congressional Budget Office estimates their plan would save more than $500 billion over 10 years.
The lawmakers wrote that it would reduce Medicare’s 75-year liability by an estimated $10 trillion.
If the supercommittee fails to agree on a deficit-reduction package worth at least $1.2 trillion by Nov. 23, it would automatically trigger that amount in cuts to defense and non-defense spending programs.
Under this sequestration process, Medicare would receive as much as a 2 percent cut, which lawmakers say would primarily affect healthcare providers and insurance companies.