How would lowering the Medicare age save the system money?

[democrattotheend]

16. Are you talking about lowering the age with buy-in?

Otherwise, it will still make the program more expensive, because adding 5 slightly healthier people to a current pool of 30 still increases costs. You still have the 30 sick people plus the 5 slightly healthier people. It would only save money if the 5 healthier people paid a full unsubsidized premium.

Even if it decreases the per capita cost for Medicare it still increases overall costs by adding more beneficiaries unless you create a new revenue stream. Having these people pay the Part B premiums currently charged to those over 65 would not be nearly enough, as those premiums are a fraction of the actual cost of providing the services.

I agree with your last two arguments, and I am making both arguments in my paper. But I need to figure out a way to argue that the Medicare system can afford to take on more people. Although it would only lower employee costs for employers with fewer than 20 employees, since employers with more than 20 employees are required to provide workers over 65 with the same benefits as other workers regardless of eligibility for Medicare (Medicare acts as secondary coverage in those instances).

The fact that it would save small employers and younger individuals money on health insurance by taking older people out of the risk pool is a strong argument for why it should be done, but it doesn't help with the argument that it would save Medicare money.

I just don't see how it would provide an affordable option for most people ages 55-64 unless it's subsidized, and I don't see how Medicare can afford to subsidize it when the Medicare trust fund is already in trouble.

I might advocate for raising the Medicare tax across the board to fund lowering the age, but even though younger people would benefit from earlier access and potentially from lower costs on the exchange or through their employer, I am not sure I like the idea of taking more money out of low and middle class workers' paychecks.

Another option would be to allow employers to subsidize Medicare buy-in for their older workers in lieu of providing insurance to them or paying a fine. This might encourage enrollment from healthier 55-64 year olds as well as sicker ones, since paying the $600/mo (or even $700/mo) might be cheaper for employers than the cost of providing primary group insurance for older workers. However, the ADEA would have to be rewritten to allow employers to help their employees buy into Medicare and use the employer-provided insurance as secondary coverage without being sued for age discrimination.