U.S. Sen. Kirsten Gillibrand (D-NY), ranking member of the Senate Aging Committee, along with 14 of her Senate colleagues, introduced the Medicare Cost Cap Act to create a $5,000 cap on out-of-pocket costs for Traditional Medicare (Parts A and B) beneficiaries.

Currently, Traditional Medicare does not have a limit on out-of-pocket costs, meaning beneficiaries are confronted with unlimited, catastrophic health care costs if they face serious illness or hospitalization. Medicare Advantage (MA), employer-sponsored insurance, and insurance bought on the marketplace all have annual caps on out-of-pocket spending. An out-of-pocket cap would level the playing field between Traditional Medicare and MA and guarantee that all people with Medicare are protected, no matter what coverage option they choose.

The legislation also enhances programs that protect low-income Medicare beneficiaries, shielding seniors and people with disabilities who already rely almost exclusively on their Social Security benefits from rising premiums and out-of-pocket costs. Under the Trump administration’s watch, Medicare Part B premiums exceeded $200 for the first time last year.

“Under President Trump, seniors are being forced to choose between paying for lifesaving care and simply being able to afford a life,” said Gillibrand. “The Medicare Cost Cap Act will lower out-of-pocket costs for seniors with Medicare and ensure that no one is pushed into financial ruin by a single health emergency. I am proud to introduce this important legislation, and I will continue fighting to expand access to quality and affordable care for our seniors.”

In 2028, 3.2 million Medicare beneficiaries are projected to directly benefit from an out-of-pocket cost cap. Over the next ten years, over 52% of beneficiaries are expected to exceed the proposed $5,000 cap at least once. On average, this plan would save enrollees $1,024 per year.

While financial support does exist for low-income Medicare enrollees, oftentimes confusing and extensive administrative barriers prevent and discourage beneficiaries from accessing these resources. These barriers adversely affect low-income seniors who struggle to afford health care. Over half a million enrollees who qualify for Medicare Savings Programs (MSPs) are not enrolled, leading to missed benefits and higher out-of-pocket costs for some of the most financially insecure Americans. In addition to creating an out-of-pocket cap, the legislation will improve assistance for low-income beneficiaries, such as seniors that rely exclusively on Social Security for their income.

Gillibrand continues to lead the fight to lower health care costs for seniors with Medicare. Last year, she introduced legislation to strengthen Medicare’s ability to negotiate prescription drug prices and reduce out-of-pocket costs for seniors. She also demanded that the Trump administration release the next round of Medicare-negotiated drug prices – savings that Democrats fought to secure. Additionally, she champions the Capping Prescription Costs Act, which would extend the cap on annual out-of-pocket prescription drug costs to people with private health insurance.