ate to transfer Medicare costs to general funds for kidney der 65 and for disability beneficiaries under 65. sive use of home health services of high quality would be 3. If a patient felt assured of this type of care they would in returning home. A less stringent definition of skilled Bled for Medicare patients. Being cared for safely and properly help the patients avoid or postpone institutionalization. s opportunity to enter these remarks. Respectfully submitted, Peter M. Shields Director Union County Division on Aging D STATEMENT OF THE AMERICAN ASSOCIATION OF RETIRED PERSONS ODUCTION American Association of Retired Persons (AARP) tes this opportunity to present our views on the the fairness of the Administration's proposals to large, undisciplined defense increases; and, deep cuts in domestic entitlement and discretionary programs. past two years, the burden of the Administration's ; fall most heavily on our nation's needy, dependent rable populations. For older Americans rly the poorest among them - the Administra -a doubling of outunder Medicare. - further significan for physician care - other reductions i assistance, housin All in all, the effec reduce the income ( cantly increasing t r testimony today w Medicare and Medica e consequences of th 2. In addition, we reducing federal spend ASSESSING THE ADMINIS The Administration pr Of 4 of $1.7 billion. will come directly ased copays and dedu cian freeze totals $ ase beneficiary out a six-month freeze on cost-of-living adjustments for social security, SSI, food stamps and veterans' pensions. p of FY 84 savings o 85 already on the b 1982). The budget pr TT 84-88. g of out-of-pocket costs for hospitalization icare. ignificant increases in out-of-pocket costs cian care under Medicare, Part B. uctions in food stamps, low income energy e, housing assistance and legal aid. the effect of the Administration's proposals income of older Americans while creasing their out-of-pocket costs. y today will focus primarily on the budget cuts and Medicaid programs, the reasons for our concern, ces of the proposed cuts on this nation's ition, we will propose alternative recommendations eral spending in the health care sector. HE ADMINISTRATION'S MAJOR PROPOSALS TO tration proposes further Medicare cuts in llion. Of the $1.7 billion almost 1 billion e directly from beneficiaries in the form of and deductibles. In addition the proposed è totals $700 million and will likely also ciary out-of-pocket costs. The proposed savings comes savings of $6.2 billion and another $7.0 billion y on the books (due to reconciliation in 1981 budget proposes total new savings of $25.26 billion st of their proposals either directly or indirectly osts now being borne by the federal government to recipients, though Medicare providers take some D. ile the Administration appears to have made its rst, any proposal to change Medicare must contribute 989, though a recent CBO study indicates be depleted as early as 1987. cant criteria for evaluating proposals is the avoidance of cost shifting to ies. The economic status of most of is precarious at best: seholds are overwhelmingly concentrated er-income brackets, particularly compared -elderly in 1981, 21% of elderly house incomes below $5,000 compared with 8% of y households and over 50% of elderly houseincomes below $10,000 compared with 19% -elderly (see table below). n income level of elderly-headed households han half (45%) that of the non-elderly. sons experience one of the highest poverty 5.3%) of any adult age group and one of the near-poverty rates (25.2%), with older women ating in these poverty categories. _ng table illustrates the economic situation |