The Senate Democrats initial reconciliation intention is to move standard Medicare eligibility to age 60 instead of age 65. This would move a huge tranche of the sickest people on the employer sponsored insurance market into the healthiest cohort of folks in the Medicare market. That would have significant premium impacts on the commercial group market. The Petersen Center for Healthcare estimates that this would lead to a 15% reduction in employer side health spending.
Lowering Medicare’s age of eligibility to 60 would reduce employers’ healthcare costs by an estimated 15% if people age 60-64 switched to Medicare.
Read the Peterson-@KFF analysis: https://t.co/absVDZ7r0S pic.twitter.com/bohgV3bpjD
— Peterson Center on Healthcare (@PetersonCHealth) June 23, 2021
I am curious if there are any dynamic modeling going on regarding network breadth and scope as well. Some of the work that we discussed earlier this week found that employer groups overvalued broad (and expensive) networks relative to the average employee. The employers were responding to the preferences of high power/high prestige individuals in the firm. If we think that a decent number of the director, VP, C-level folks are in their early 60s and some would be moved to Medicare with a full company paid supplement, perhaps the dissonance between the HR valuation and prioritization of scream minimization and average enrollee valuation of networks could potentially be reduced. And if employers are more willing to credibly threaten narrow(er) networks, better pricing per unit for fewer units could be achieved.
Brachiator
So, this is good for employers. What’s in it for employees?
Most employer plans are currently better than Medicare. They include good dental and vision coverage among other benefits.
Mart
I’m willing to retire early with Medicare, but only to help my company compete with Canadian firms!
germy
@Brachiator:
Schumer, Sanders push to add dental, vision coverage to Medicare
https://www.nydailynews.com/new-york/ny-schumer-medicare-dental-vision-hearing-20210620-4va2ukccyrd6hmkhysdwtmon3m-story.html
VeniceRiley
Ah, if only it would travel overseas with me. hey, that would be a great incentive to retire and make room for the kids to move up!
Ruckus
How many people forced into Medicare, even with a fully paid Medicare Advantage arrangement would be happy about that? Sure with a good, paid, MA arrangement it would make Medicare far more useful than it normally is because Medicare is basically a last resort, better than nothing system. Because without an MA program, which costs often a lot more than a retired person can pay, Medicare is currently not very good at all. Any major issue will likely bankrupt the very people that Medicare is supposed to cover, without an Advantage account. It of course doesn’t have to be this way but there is money to be made so of course that’s what we do, make a lot of the people who don’t have a job and never will ever again, destitute.
I say this as a person of Medicare age, but with the fortune of having a different program to use for my healthcare, the VA. Senior healthcare costs would kill me without the VA. And I mean that literally, given my healthcare needs, I’d be broke without an MA program. I am far from alone in this position, I’ve known many others in the same situation, without that different program. Find out what you’d make from SS if that was your only income and Medicare was your only healthcare choice. How many people paid in the maximum in SS over their lifetimes? What is the average SS monthly payout? Could you live on that?
Matt McIrvin
@Brachiator: I’d expect some employers to complain that it will worsen their labor crunch. Though generally people in their early sixties are not the ones they’re most eager to hire.
Almost Retired
@Brachiator: There’s probably not much in it for early 60’s employees who intend to keeping working full-time for a employer providing generous benefits (although under current rules, employers of less than 20 can basically force eligible employees onto Medicare as the primary insurer).
But it’s certainly a boon for those who want to cut back in their later years by, for example, working for a smaller employer, transitioning into consulting, work part time, or retiring early. Flexibility! This is the MOST important issue facing the Republic and civilization in general, says the guy who will be turning 60 this Summer and wants to retire….
WhatsMyNym
@Brachiator:
Those are available as addons either separately or in Advantage plans. My mother’s old employer gives her money in a Retirement Health Account for her to pay for the extras.
Medicare at 60 would be great for me, I’m currently buying through the ACA and it costs a lot.
Geo Wilcox
@Ruckus: It could be run like Tricare and Medicare. Medicare is the primary insurance and the secondary insurance (whether the employer, MA, or like mine, Tricare) picks up the rest.
Brachiator
@Matt McIrvin:
Some employers may not be eager to hire people age 60 plus, and sometimes may be eager to fire them to save on wage and benefit costs, but these people are often among the most productive. So there may be value in incentives to retain this class of employee.
Ohio Mom
I’m sure employers would pass those savings on to employees — NOT.
I see this as both a giveaway to business and a life-saver for many. I can live with the giveaway, that is one of the main ways anything gets done in this country, and I love anything that strengthens and expands the social safety net.
Next up, I’d like to see vision, dental and hearing added to Medicare and the Social Security age lowered, at least back to where it used to be. Not that I’m holding my breath…
Ruckus
@Geo Wilcox:
I understand. But. And it is a big, firm, misshapen but.
Not everyone is in a great financial position. Not everyone worked for a huge company with great pay and benefits right up to the moment they retired, has a pension and SS, and can easily afford a Medicare Advantage program. Or worked, as I know someone who has, for the government for 40 yrs and gets a pension, SS and made an above the average wage, whose house is paid for. There are millions in this country who don’t fit into those neat categories of reasonable retirement for whom SS is their retirement package and Medicare by itself is their healthcare program.
Brachiator
@WhatsMyNym:
My dentist does not accept Medicare Advantage patients. He says the reimbursements are not worth it. And in California, dentists who welcome Medicare patients are among those with the highest complaints for performing poor quality or unnecessary procedures.
I have been reading some stories of people in Southern California who go to Mexico to get dental work done.
ETA. I can understand wanting a less expensive Medicare plan over ACA. Makes total sense.
WhatsMyNym
@Ruckus: It really depends on what state you live in, because it is usually handled by Medicaid picking up the extra. It sounds like the states you know really suck.
lee
@Brachiator: My Vision and Dental are completely separate policies/insurance providers offered by my employer (and much less expensive than medical). It would be easy enough for me to drop medical but keep the other 2.
The question I have is the corner cases: What about the 60 year olds that have dependents that still qualify for their health insurance?
I wonder if they could stay on the employer plan.
Honestly they need to ask for 55 so they have some negotiation room.
Brachiator
@Almost Retired:
This sounds great for a niche of well compensated employees with good retirement plans. But I think that may be a small niche.
rikyrah
I will never
ever ever
ever ever ever
Forget that Medicare’s age wasn’t lowered to 55 – TEN YEARS AGO DURING THE CREATION OF OBAMACARE
BECAUSE OF PHUCKING JOE LIEBERMAN
rikyrah
@Ohio Mom:
ABSOLUTELY!!
WhatsMyNym
@Brachiator: I use Delta, never had a problem. My brother is on a Advantage plan in California, no problems.
lee
@Ohio Mom: Most companies now have the employees picking up a significant portion of the health insurance costs.
It really depends on the company, but my guess is the amount that the company might save on health insurance they will funnel into other benefits.
I work a lot with HR and they have a budget. So that budget will now get to cover more benefits.
Zelma
One advantage that no one is mentioning is cost containment. Private insurers pay substantially more for procedures than Medicare does. Putting high users of medical services onto Medicare could reduce costs. I have top of the line Medicare supplement insurance – no copays, no questions – which costs me less than $3500 per year. Even with the monthly Medicare payment that most people pay, the cost is about $5000. Not bad for someone who is almost 80. My friends who are on Medicare Advantage programs pay much less and they are uniformly content with their coverage.
I would think that employers, especially those who buy insurance on the open market, would be happy. And it might improve the job chances for people over 60 since the age range of employees effects the cost for small employers. This is a disincentive to hire older folks.
lee
@rikyrah: I had the same $&(#*#( thought when reading this post.
If there is an afterlife, I hope that MF’r suffers for eternity.
Brachiator
@Ohio Mom:
I am not sure that we will ever see the Social Security age lowered. A large portion of the population is age 65 or older, and they are living longer. Adding people age 55 or 60 might increase costs and reduce the number of people paying into the system.
l3000
Moving to 60 would be a huge boon to people that are caught in the Medicaid gap (aren’t eligible for ACA or Medicaid) in states that didn’t expand Medicaid and/or have stringent Medicaid requirements that exclude numerous single adults without children or disabilities. Getting poor insurance, even without Advantage extras, is better than no insurance. By the age of 60 medical issues put off start looming. If Dems actually pushed through vision/dental etc. for Medicare it would also be wonderful. I won’t be holding my breath.
StringOnAStick
@Brachiator: I have friends who have gone to Mexico to get dental work done that they simply could not afford here. There are towns on the border that exist for that reason, even a part of the town called “Molar City” on the google map; there’s a huge parking lot (for a price) on the US side. So far they have been happy with the results, but they also got a reference for which dentist to go to when they decided to do this. It was this or lose enough teeth that getting dentures was going to be coming up fast, and those are expensive too.
artem1s
@Ruckus:
Not me. M4A sucks. There will never be real healthcare reform until legislation addressed the issue of post-retirement bankruptcy due to the things that Medicare doesn’t cover and the 80% payout cap. My 80+ year old mother had to drop thousands of dollars on hearing aids and she has an MA supplemental plan. I never want to hear M4A used as a litmus test for the Democratic party candidates ever again. Some Berners’ promise to fix it after the fact rings about as true as the GQP’s promise to come up with their own plan once they kill ACA forever.
Medicare has to come with a cap on the co-pays and eliminate the sign up penalty or else it’s useless as a remedy for the uninsured or underinsured. And employers should never be allowed to forced it on anyone.
Ruckus
@WhatsMyNym:
Picking up the extra.
So there is a need for picking up the extra. That is my point, there is an extra. What if you live in a state that doesn’t pick up the extra? What if the state you live in needs a bigger extra because of living costs? Do I have to move someplace I don’t want to because of extras? How does someone pay extra to move to the state that has a bigger extra if they can’t afford it because there is no extra? How does one find out which state is one with that extra? What happens when a republican gets elected in that state with that extra, who wants all the extras for themselves? Who knows all the hoops to jump through to get the extra? What if we just made the program work properly in the first place?
Another Scott
I’m sure that may employers would try to find ways to game the system to cut their costs. But it would be short-sighted. Quits are at record levels now. Labor is gaining more power, and people are starting to use it to look for better positions. I wouldn’t be surprised if many employers are “forced” to start increasing benefits rather than cutting them.
I assume the greatest impact in dropping the age to 60 would be for those people who have to work part time, are “independent contractors”, etc., and get few if any benefits. I also assume that it would help people who are nearly disabled from injuries on the job, just wear and tear from a hard life, etc., who do not qualify for “disability” for whatever reason.
It’s a good thing, even if some employers want to try to shift costs onto the feds.
Cheers,
Scott.
CaseyL
@Brachiator:
I am 65 and still working FT for an employer offering comprehensive health benefits. I’ve checked and re-checked, and everyone told me that until I lose that employment, I don’t need to apply for Medicare. So employees who have great HC plans through their employer can keep the great HC plan.
Cheryl from Maryland
@artem1s: THIS. My 97-year-old mother-in-law dropped so much out of pocket for hearing aids that she won’t go to get them adjusted, replaced, etc. It’s affecting her memory and excruciating to talk to her. My husband just turned 65, and while we are lucky that we both have BC/BS Federal insurance as our secondary insurance, he’s paying MORE now than pre-Medicare.
WhatsMyNym
@Ruckus: Well I’m familiar with other countries as well, and they have big issues as well with funding or just not offering services that we have come to expect. They just don’t talk about it.
From I’ve heard locally, the VA has big problems too.
Almost Retired
@StringOnAStick: Yup, I have elderly neighbors who schlepp to Los Algodones (Molar City), roughly across the border from Yuma, Arizona, for quality dental work. The first time I heard of it, my 80 year old neighbor said he was going to Mexico to “get his bottoms done.” I was alarmed until he explained it further.
lee
@CaseyL:
You signed up right? I just went through this with a friend at work. You ‘signup’ when you reach the appropriate age. The next step is you apply for the benefits.
There is significant increase in premiums if you don’t sign up as soon as you are able.
After that he had to just fill out a form every year with our employer that he isn’t using his Medicare benefits.
WhatsMyNym
@Cheryl from Maryland: Sadly, Hearing Aids is the wild west of medical services. You really have to shop around to get good service at a reasonable price (cough, cough COSTCO).
Ruckus
@artem1s:
I see we are on the same page.
My parents are both gone, very likely for people my age, early 70s. Mom gone 9 yrs, dad gone 20. They both lived well into Medicare age, both had to supplement Medicare with savings because it didn’t cover what they needed. Now dad lived a long time with Alzheimers, a lot longer than I’ve heard many others have, and mom sold the house she lived in for a rather large profit. But by the time both went their money was all gone. Had they lived longer they would have died deep in debt, as many do.
I’ve just retired (sorry I can’t help writing that out, I’m still amazed that I can) and I have what is actually pretty good healthcare. But the rest of my life is somewhat of a mystery as to where it will go or what will I be able to do, as it is for most of us in this position. Far more of us find ourselves without the safety back up that I have, let alone more. Maybe I’m thinking this country can afford to take not unreasonable care of those who worked an entire adult lifetime to support fucking billionaires in the lifestyle that they have become accustomed to. Especially as they have put in money for that entire lifetime to do just that. I guess I’m tired of working long hours, in a somewhat dangerous job, to make things like Barbie dolls, and 5 gallon water bottles and dozens of other plastic products available, produce parts for the aerospace industry so people can fly anywhere in the world, work in professional sports for others enjoyment, and for what? Isn’t the point of working to be able to retire and have a bit of relaxing time to contemplate your navel, for all of us?
Ruckus
@WhatsMyNym:
The VA does have problems. Financial to some extent, many of the Vietnam era are in my age group and are on that healthcare downward spiral that all end the same way but cost a lot to get there and there is not nearly as big a contingent behind us. And a lot of that contingent is in deep, deep need of healthcare that many did not need as much of, because of many multiple deployments. Battle stress is a very real issue, made worse by pushing fewer too far. It’s expensive because it is not a cut and stitch illness, it doesn’t have a set resolution and while not new it is a difficult thing to fix. The second side is that a lot will live with massive injuries because of better medicine. Fatalities are down, lifetimes of need are up. You want to see why, come with me to the VA and I’ll show you. The hospital that I go to was built 50 yrs ago. It’s in good shape but it’s barely enough for the numbers of patients. The docs are mostly great the nurses very good and the support staff is pretty damn good, but the budget is always under siege and the last maladministration did noting but make every thing in the federal government worse, just by it’s concept of governing is to do the worst that you can imagine, every day.
Frank Wilhoit
Narrow networks discriminate — sometimes very heavily indeed — against low population density.
They also reward owners of hospital chains, whose pitch to the insurers is, I got your network right here.
There seems to be a little bit of handwaving in the argument against broad networks as undermining cost control.
Talk about how networks are built: whom the crucial negotiations are between, who brings what to the table, who can make the unrefusable offers.
sab
@Matt McIrvin: I work in a small public accoumtimg plan, and several of my employers have been more than happy to keep older employers well into their medicare years. The employees are experienced and the switch to medicare with a supplemental is a huge savings even if the employer has to pay it
ETA Usually those employers have less than excellent plans.
Bob Hertz
Lot of good comments here, but no one gets into actually paying for Medicare expansion.
There are about 20 million persons between ages 60 and 64. If we use a rough number of $12,000 in cost per Medicare enrollee, that is an increase of $240 billion a year in federal spending.
Some politicians in both parties would just “put it on the card,” which is what we did with the Part D expansion of 2003.
One option would be to ‘claw back’ significant revenue from the affected employers, who will save huge amounts of money. That is easier said than done, however.
Raising the Medicare payroll tax by 3% would also pay the cost, but this dumps it all on the same young people who are already hurting.
mazareth
If this actually happens, I’m retiring in 2023.