Options for Change under Medicare: Impact of a Cap on Catastrophic Illness Expense

This study analyzes the total deductibles and coinsurance Medicare beneficiaries accrued in 1980. The study shows that Part B services accounted for 70 percent of all liability and Part A for 30 percent. Only 21 percent of enrollees exceeded $270 in liability from Part A and Part B combined. In 1980, if every enrollee had paid a surcharge of about $70, all liability over $270 could have been capped—without any additional program outlays. Similarly, projections for 1984 indicate that a surcharge of $98 could cap all liability over $800. For Part B alone, a surcharge of $113 could cover all liability over $200.