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House of Representatives
Session of 2013 - 2014 Regular Session


Posted: January 31, 2013 10:20 AM
From: Representative Seth M. Grove
To: All House members
Subject: PACE/PACENET Social Security COLA Moratorium and Medicare Part B Income Exclusion
Pennsylvania’s premier prescription drug assistance programs for seniors, PACE and PACENET, provide life-sustaining medications to approximately 300,000 older Pennsylvanians. Unfortunately, while many individuals readily welcome Social Security cost-of-living adjustments, such COLA increases typically result in some individuals facing ineligibility due to the increase in income.

Last session, Act 21 of 2011 resulted in permitting approximately 30,000 PACE and PACENET cardholders to retain the benefit which they would otherwise have lost as a result of Social Security COLA increases. The COLA moratorium under Act 21 is scheduled to expire on December 31, 2013. Unfortunately, the 2012 Social Security COLA of 3.6% combined with the recent 2013 COLA of 1.7% is estimated to result in over 40,000 PACE and PACENET cardholders exceeding eligibility limits and, thereby, losing their benefits. I am proposing to extend the current Social Security COLA Moratorium until December 31, 2015.

In addition, according to the PA Department of Aging, approximately 8,200 seniors would qualify for PACE and PACENET if their Medicare Part B premium would be excluded from the current definition of “income” in the PACE law. In real terms, seniors never receive the “income” for the Medicare Part B benefit since it is deducted directly from their Social Security checks. The average of this Part B benefit is approximately $106/month, or $1,200/year. I am proposing to exclude the Medicare Part B premium payment from the definition of “income”.

Please join me as a cosponsor of this important legislation that will benefit nearly 50,000 seniors. This proposal is made possible due to a combination of existing Lottery Fund revenues, additional savings generated by federal changes which have provided for a “donut hole” discount in Medicare Part D and increased rebates for brand and generic pharmaceuticals.

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Introduced as HB777