How would lowering the Medicare age save the system money?

[democrattotheend]

As some of you know, I am working on a paper arguing against raising the Medicare age for my health policy grad school course. I am trying to decide which alternative solutions to propose, and one that I have seen here and on Kos is to lower the eligibility age to 55 or 60 (proposals to lower it to 0 are outside the scope of my paper, even though philosophically I agree). For those who advocate this, I would appreciate if you could help me understand what you are proposing and how you think it would keep Medicare solvent for longer.

Obviously, lowering the age without either a buy-in or an across-the-board hike in the payroll tax rate would not only not save money, but would worsen Medicare's solvency problem by increasing the number of beneficiaries without increasing the funds to pay for them. So I assume that is not what is being proposed.

I have looked into buy-in, but the problem is, the unsubsidized premium would be over $600 per month, which is less than what my self-employed parents currently pay for health insurance but still too steep for many of the people who would need it. And if you subsidize it, then it costs money rather than saving money (although the subsidies could potentially come from the amount that has been budgeted for subsidies on the exchange). But either way, it costs the govt. more money if the premiums are subsidized. Even if the Medicare buy-in is completely unsubsidized, I still don't see how it would save the Medicare trust fund money unless the premiums were higher than the estimated cost of providing benefits, which would mean making them even higher than $600 per month.

There's also the problem of adverse selection: if the bronze plans on the exchange have lower premiums (and fewer benefits or higher copays), the healthiest people ages 55-64 would be likely to choose a less expensive plan on the exchange, and those in need of more care would be the ones who buy into Medicare. So allowing Medicare buy-in at age 55 would not necessarily make the overall Medicare risk pool healthier, particularly when you consider the fact that some of the people that age who lack employer-sponsored coverage had to retire early because of health problems.

I am not saying that lowering the Medicare age is not good policy (I would lower it to 0 if I were in charge), but as a way to save the Medicare trust fund money I just don't see it.

Am I missing something?