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Updated: Aug 5, 2026

Quantitative Autonomic Testing
Published on: July 19, 2011
Means-testing in Medicare
1Health Care Systems Department, Wharton School, University of Pennsylvania, Philadelphia, USA. pauly@wharton.upenn.edu
Abstract:
The Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003 introduces means-testing of premiums and benefits in two ways. It will means-test the Part B premium, setting higher premiums for better-off seniors. More importantly, it will offer much more generous drug benefits, at low or zero premiums, to lower-income beneficiaries. This paper argues that additional means-testing could improve Medicare's financial picture. It proposes a strategy in which future Medicare beneficiaries with higher incomes will pay for cost-increasing but quality-improving new technology, possibly with prefunding that begins before retirement.
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