Expansion in Medicare would make more affordable for seniors: Avalere

President Joe Biden and progressive Democrats have proposed to lower Medicare’s eligibility age to 60, to help older adults get affordable coverage. But a new study finds that Medicare can be more expensive than other options, particularly for many people of modest means. Although lowering the Medicare eligibility age from 65 to 60 could provide an additional 24.5 million individuals with coverage, the expansion could make premiums less affordable for some.

1. A recent study reveals: Avalere, a market analysis and consulting firm compared Obamacare premiums to premiums for Medicare coverage in Houston, Miami, Los Angeles, and Chicago for a hypothetical 60-year-old nonsmoker and a 65-year-old enrolled in Medicare. It found that many older adults with low to modest incomes can already find cheaper premiums in Obamacare’s markets, while those in the solid middle class would be more likely to benefit if they could get into Medicare.
2. Approach to affordable care: “Simply expanding Medicare as it is to younger people do not always mean those patients are getting a better deal,” said Chris Sloan, an industry analyst at Avalere. “The things that the Biden administration has done to increase the Obamacare subsidies through 2022 have made it really affordable.”
3. Avalere Analysis: The Avalere analysis also found that uninsured people make up only 8% of the 24.5 million adults ages 60-64 who would qualify for Medicare by lowering the eligibility age. Of the total, about 6 in 10 currently have employer coverage. The Avalere analysis did find that traditional Medicare has an important advantage over Obamacare because hospitals and doctors nationwide accept it, whereas coverage through private insurers generally relies on restrictive networks.
4. Complicated Medicare plans: Economist John Holahan of the Urban Institute thinks thank said the new research “illustrates an important point.” “Medicare, as it stands right now, is a sort of complicated beast with a separate drug plan and no out-of-pocket caps,” he said. “The nation has that in the ACA, and at a pretty heavily subsidized amount.”
5. Strategies needed to bring a change: Without other changes, lowering the Medicare eligibility age may not really solve coverage or affordability problems, said health policy expert Katherine Hempstead of the Robert Wood Johnson Foundation. “It’s hard to see a lot of obvious situations where ‘Wow, this is a great deal’ for someone or a big improvement over the status quo,” she said.