One Pagers

World's Worst 2-For-1 Deal

December 12, 2012 10:39 am ET
According to media reports and pundits, there's talk of a budget deal including a proposal to raise the Medicare eligibility age -- a deeply unpopular idea that is also fiscally irresponsible. Here's how to undermine politicians and pundits who claim otherwise.

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Raising the Medicare age: the world's worst 2-for-1 deal.

Connect: Americans expect to get what they pay for and for our government to spend our money efficiently.

Define: Raising the Medicare age is the world's worst 2-for-1 deal: It would cost Americans $2 for every $1 it saves Congress.

Explain: Forcing seniors to wait longer for Medicare means taking them out of the most efficient system and pushing them into wasteful and costly private insurance pools -- driving up costs for everyone.

Discredit them: If you're a wealthy politician who doesn't worry about affording health care for himself or needing to retire after a lifetime of manual labor, sure, it's no big deal to you.

Discredit the idea: But if you're serious about fiscal responsibility, this gets you the opposite of what you'd want: a health care system that gets us less value but costs everyone more.

Offer solutions: Medicare is a leader in controlling health costs system-wide. Let's make it even stronger and more efficient, not weaken its power to save us money and keep health care costs in check.

Values: It's not just wrong to cut the Medicare benefits of janitors and maids who aren't living longer just because the richest Americans in white collar jobs are. It also costs us all money.


  • Raising the Medicare eligibility age by two years is a deeply unpopular idea, with strong opponents outnumbering strong supporters by 2-1.
  • Only some Americans are living longer past age 65: over the past four decades, earners in the richer half of incomes saw their life expectancy go up, but earners in the lower half saw an increase of barely more than a year. 
  • The proposal is also a 2-for-1 dud: while the federal government would save $5.7 billion a year, costs would increase by $11.4 billion in other parts of the health care system.
  • Specifically, the proposal  will mean --
    • More seniors without any insurance at all (because Republican governors of some states are refusing to implement the Affordable Care Act);
    • Higher monthly premiums for seniors with Medicare (by keeping younger, healthier 65- and 66-year-olds out of Medicare's insurance pool);
    • Higher premiums for everyone else with private coverage (because older adults would stick with private insurance for two extra years before moving into Medicare);
    • Higher employer costs (because older workers would try to stay on company insurance plans); and
    • Higher out-of-pocket health care costs for two out of three older adults whose entry into Medicare would be delayed.
  • The average person on Medicare already pays roughly $4,600 per year in out-of-pocket medical costs, and higher health care costs from raising the Medicare age to 67 would consume up to 45% of a middle-class senior's Social Security check.
  • Medicare is vastly more cost-efficient and controls costs better than private insurance, which has administrative overhead as high as 17%.
  • Half of all Medicare beneficiaries had incomes below $22,000 in 2010, and less than 1% had incomes over $250,000.
  • Let's remember that only recently, Republicans in Washington were pushing a Medicare plan that would financially harm all current and future seniors -- costing $11,000 more for a 65 year old and $330,000 more for a 30 year old and undermining and ending "traditional Medicare," too.



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Posted in - Health Care - Economy - Seniors

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