Summary

GAO updated its report on proposed legislation to relieve elderly Medicare beneficiaries from out-of-pocket catastrophic health care expenses.

GAO found that two newly proposed bills would: (1) place an upper limit on beneficiary liability for certain Medicare deductibles and coinsurance; (2) cap physician services, hospital care, and skilled nursing facility coinsurance during the first 150 days, and add Medicare coverage for prescription drugs and in-home care; (3) still leave the elderly at risk of high out-of-pocket expenses for nursing home care, home health care, and other services that Medicare does not cover; and (4) not cover physician expenses in excess of the Medicare-determined reasonable charge rates. GAO believes that, although: (1) the bills would represent an important step in increasing available health insurance coverage for the elderly, significant gaps would remain; and (2) other proposed legislation would cover some of the gaps, the additional relief would increase Medicare costs.