Medicare is broke. One health care “reform” idea has been to expand its age eligibility, which obviously would add to the program’s cost. People’s health care costs tend to rise steadily as they age, so the group just under typical Medicare eligibility at age 65 is fairly expensive. This report examined the effect on private health insurance of moving older workers and their older family members to Medicare. (KFF Report) Note that currently Medicare is always a secondary payer when someone has private insurance, so not sure if the authors are assuming this changes. If not and the worker continues to have access to their employer’s health plan, shouldn’t be much effect on Medicare or the employer. The researchers find that lowering Medicare eligibility age to 60 would lower employer health plan spending by 15%. Lowering it to 55, would reduce spending by 30% and to age 50 by 43%. Those figures assume that everyone switched from the employer plan to Medicare. Total health spending might also decline because Medicare sets the rates it pays providers and they are substantially lower than the rates typically paid by employer health plans. Health care providers claim they lose money on Medicare, which is dubious, but if a lot of their business switches to Medicare, there will likely be substantial political pressure from providers to increase Medicare payments. And they would likely raise their rates even more to the remaining private health plan business. Not the smartest idea in the world to muck around with a program that is already broke. And more government in anything usually means inefficiency and poorer quality.
✅ Subscribe via Email
About this Blog
The Healthy Skeptic is a website about the health care system, and is written by Kevin Roche, who has many years of experience working in the health industry. Mr. Roche is available to assist health care companies through consulting arrangements through Roche Consulting, LLC and may be reached at [email protected].
Healthy Skeptic Podcast
This is an outstanding report on total global drug spending and trends, with projections out to 2025. It helps you understand this important area of health care, which does much...
June 1, 2021
MedPAC 2019 Report to Congress
June 18, 2019
IBM ending a huge bust in its health care efforts, selling its Watson health care assets to a PE firm. IBM spent a fortune building this and claimed it would...
January 21, 2022
More lunacy, kind of ironic for a mental health company, as Lyra Health raises a fresh $235 million in capital at over a $5 billion valuation. Just gonna say the...
January 20, 2022
More froth in the capital markets as R1 RCM pays $4.1 billion for CloudMed. R1 RCM helps health care providers with billing and other practice management software and services and...
January 12, 2022
Access ACO Care Management Chronic Disease Comparative Effectiveness Consumer Directed Health Consumers Devices Disease Management Drugs EHRs Elder Care End-of-Life Care FDA Financings Genomics Government Health Care Costs Health Care Quality Health Care Reform Health Insurance Health Insurance Exchange HIT HomeCare Hospital Hospital Readmissions Legislation M&A Malpractice Meaningful Use Medicaid Medical Care Medicare Medicare Advantage Mobile Pay For Performance Pharmaceutical Physicians Providers Regulation Repealing Reform Telehealth Telemedicine Wellness and Prevention Workplace