Lowering the Eligibility Age of Medicare
President/CEO at Healthcare Solutions Direct, LLC, a nationwide insurance agency focused primarily on the retiree health market.
As the Biden administration begins acting, there are more and more healthcare initiatives that are coming to the forefront with concerns about policy changes. This often means updates or modifications to Medicare, and while your insurance agent should keep you informed on anything that will impact you directly, it is good to know what the folks up on Capitol Hill are up to when it comes to healthcare.
The latest developments are currently just in discussion as the administration plans to take another look when it comes to healthcare reform. What is one of the biggest concerns is what happens if the eligibility age for Medicare changes?
Pushing Medicare’s eligibility down
Certain policy elements are almost always up for grabs when it comes to healthcare changes. These include things like drug prices and healthcare coverage. What is different this time around though is the possibility of changing Medicare’s eligibility age from 65 to 60.
It may not seem like a significant step by lowering the Medicare eligibility age by five years, but this small change would give access to almost 23 million more people in the U.S.
It is a popular idea for some circles and not so for others. About 77 percent of individuals are in favor of lowering the eligibility age for Medicare as far down as 50. When it comes to lowering the age of eligibility for Medicare it will fundamentally change this type of coverage, so it is not something to take lightly. The question that remains is would it be for the positive or negative. That debate can be successfully argued by both sides.
On the pro side
The biggest positive to lowering the eligibility age for Medicare is that it enables people 60-64 access to good healthcare coverage. It would also bring down the cost of healthcare for people within this age range and may decrease premiums for those already enrolled in Medicare.
Lowering the Medicare eligibility age also removes a segment of the population who spends the most on healthcare when it comes to employer insurance. It is just a fact that older individuals will on average, need more healthcare services than those who are younger. Providing Medicare access to this group of people helps employers save on insuring its employees. It also helps those that are using healthcare services the most get more affordable options.
The other positive about lowering the eligibility age, is that when this segment of the population is out of work for whatever reason, they will continue to have access to affordable health insurance.
On the con side
The con to this fundamental change to Medicare by lowering the eligibility age could endanger traditional Medicare and increase financial risk. The financial risk for those going onto Medicare early could be an exposure to no out-of-pocket cap with traditional Medicare. Those who do not enroll in a Medicare Supplement plan, or an alternative Medicare Advantage plan could be left with some big out-of-pocket expenses when it comes to their healthcare. The other question is how insurance companies would price out these policies with the eligibility age now lowered.
The change could also play a part in shrinking the workforce. People within the 60-64 age range who were waiting to retire until becoming Medicare eligible, could choose to leave their jobs a little earlier.
There is also concern that hospitals and doctors would push back since adding more people into the Medicare system would impact their incoming revenue. This is because Medicare negotiates lower rates with healthcare providers which included hospitals and doctors’ offices. Many would not be able to financially survive a drastic cut in the income disparity between Medicare and that of employer group coverage.
Change is always constant
There is no way to know what the future will bring when it comes to Medicare. What policies will get pushed through, which will be rejected, but lowering the eligibility age for Medicare is an important topic for all our political leaders. It is most likely a safe bet to assume changes will happen down the road at some time in our lifetime.
Contact Healthcare Solutions Direct to understand your options
Finding the right Medicare plan for your personal needs is essential to maintaining both physical and mental health in an affordable way. While getting the right coverage is important, finding the balance between care and cost is too. Let the insurance experts at Healthcare Solutions Direct help you navigate your Medicare plan options. We represent the major Medicare carriers in the US, allowing us to pinpoint the best choice for you. After pairing you with the right plan, we walk you through the entire process, supporting you the entire way. To learn more, contact us today.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.