Senators, experts support current Medicare policy

"Overall, beneficiaries' out-of-pocket health spending has risen faster than their incomes in recent years, from around 12 percent in 1997 to more than 15 percent in 2009, and Medicare households spend three times as much of their household budgets on health care compared with non-Medicare households," Cubanski said.

Cubanski testified that recent polling by the Kaiser Foundation found that "While policymakers weigh potential Medicare savings options to reduce the deficit, the public does not perceive a need for significant cuts."

She said the polling shows that a majority of the public (75 percent) believes that deficit reduction can occur without major reductions in Medicare spending. "In fact, 58 percent of Americans say they would not be willing to see any reductions to Medicare as part of deficit reduction discussions."

She said when asked about specific proposals to reduce Medicare spending in the context of deficit reduction, a majority of Americans expressed support for two proposals:

1. Requiring drug companies to give the federal government a better deal on medications for low-income people on Medicare; and
2. Requiring high-income seniors to pay higher Medicare premiums; these proposals were supported by 85 percent and 59 percent of Americans, respectively.

"Notably, the survey also shows that relatively few Americans (roughly 20 percent) are aware that wealthier Medicare beneficiaries already pay higher premiums for their Medicare coverage," she testified.

Cubanski testified that other proposals are opposed by a majority of Americans, including:

1. Requiring all seniors to pay higher Medicare premiums;
2. Increasing the payroll taxes workers and employers pay to help fund Medicare;
3. Reducing payments to hospitals and other health care providers for treating people covered by Medicare; and
4. Gradually raising the age of Medicare eligibility from 65 to 67 for future retirees.

These proposals were opposed by 85 percent, 55 percent, 51 percent, and 51 percent of Americans, respectively, Cubanski testified.

Sen. Bill Nelson, D-Fla., chairman of the committee, said he had learned from visits last week to care centers in Florida, his home state, added to that by saying that incentives to increase care coordination "offers more than just savings in dollars, it saves hours of time in a Medicare beneficiary's life. Reducing hospital readmissions will not only save the Medicare program billions, it will save beneficiaries from potential infection and further out-of-pocket expense."

The issue of vouchers, a key feature of presidential candidate Mitt Romney during last fall's presidential campaign, did not come up at the hearing.

Nelson acknowledged that "Congress faces a budget crisis that once again puts the debate on exploding health costs — and by association the Medicare program — front and center."

But he said that a recent report by the Congressional Budget Office had provided some "good news," that federal spending on Medicare has been significantly lower than predicted over the past three years.

He said that Medicare spending in fiscal year 2012 grew by just 3 percent to $551 billion, according to CBO. "That represents the slowest rate of growth since 2000.

"While this is great progress, we all know financial challenges lie ahead. As more and more baby boomers retire and health care costs continue to rise, Medicare spending could reach $1 trillion by 2023. We're making progress, but we know we can do better."

Sen. Susan Collins, R-Maine, ranking minority member of the committee, also did not talk about vouchers.

She said she has opposed efforts in the past to restructure Medicare "in a way that could be harmful to the 50 million American seniors and disabled individuals who rely on the program.

"The real key to getting Medicare costs under control is to get health care costs under control. Today, the United States spends 18 percent of its gross domestic product on health care, more than any other industrialized country."

Yet, Collins said, "We lag behind other nations on many measures of quality. In health care, quantity does not always equal quality, and clearly there is more that we can do to reward value rather than volume and quality rather than quantity."