More on raising the Medicare age

WSJ has a debate on raising the Medicare age featuring Maya MacGuineas (yes) and Aaron Carroll (no).

I think Aaron is correct that it is a bad idea in policy terms (and truly dreadful if the ACA is repealed), but I also believe it is virtually inevitable that we will raise the Medicare age as part of any ‘grand bargain’ that moves ahead with the ACA and related changes. As I write in Chapter 7 of my book p. 74-5:

I do not suggest raising the Medicare age as a policy option, because it mostly shifts, and doesn’t reduce costs. Removing the youngest and therefore healthiest sliver of the Medicare program will not revolutionize the cost of the program, but would shift some costs from the federal budget onto beneficiaries or to another aspect of the federal government (income based premium support, for example). In fact, recent analysis suggests that doing this will increase overall health care spending, because all such a policy does is to move persons out of the largest risk pool (Medicare) into a smaller one.

As a stand-alone policy, there is no doubt that raising the Medicare eligibility age this is a bad one. And doing so assumes the implementation of exchanges under the ACA. However, I am open to raising the Medicare age in a manner that equalizes it with the Social Security retirement age as part of a broader political deal that either brings about federally-guaranteed universal catastrophic coverage or an agreement to move ahead with implementation of the ACA that makes reform the responsibility of both parties. For many Conservatives, a move such as this one is a strong signal of seriousness in addressing long range health care cost problems. As I say, I don’t think they are correct, but there is a policy logic of increasing the age along with Social Security increases given that they have been linked for so long. In the end, I would potentially agree to this, so long as what is gained in return is consequential enough.

For me, it depends on what else is in the deal.

cross posted at freeforall

Author: Don Taylor

Don Taylor is an Associate Professor of Public Policy at Duke University, where his teaching and research focuses on health policy, with a focus on Medicare generally, and on hospice and palliative care, specifically. He increasingly works at the intersection of health policy and the federal budget. Past research topics have included health workforce and the economics of smoking. He began blogging in June 2009 and wrote columns on health reform for the Raleigh, (N.C.) News and Observer. He blogged at The Incidental Economist from March 2011 to March 2012. He is the author of a book, Balancing the Budget is a Progressive Priority that will be published by Springer in May 2012.

4 thoughts on “More on raising the Medicare age”

  1. The wise move is to protect current Medicare age (with an eye to reducing it, not increasing it, later).

    If one thing can be learned from the last few years it is that deals trying to placate “conservatives” are going no where worthwhile.

    In the end, the best protection of Medicare is moving to a single payer medical system which is able to control costs. We can afford that and the nation needs it.

    1. Yes, yes, yes! I have worked in acute care for 26 years. I argue in favor of lowering the Medicare age as a means to: incorporate younger, healthier particpants, bring in added revenue by charging those younger participants more than current Medicare copays but less than traditional insurance, allow a gradual phase-out of health insurance companies in favor of a single payer system.
      We have several initiatives mandated because of the power Medicare wields that are saving patient lives. Should we have been implementing these things before simply because they were the right thing to do? Of course. But it has only been since dollars, not lives, were on the line that change has happened.

  2. It is imperative that fundamental changes be made to these entitlement programs. The eligibility age for Medicare, Medicaid, and Social Security should all be raised. The programs should be targeted so that only the neediest of Americans are the ones receiving benefits. States should be given block grants for Medicaid so they can then distribute to the neediest of areas. Very importantly, entitlements should be changed into budgeted programs, balanced against other needs

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