A Republican proposal to raise Medicare’s eligibility age gradually from 65 to 67 has gotten the cold shoulder from congressional Democrats, but an awkward silence from the White House.
While it may be the latest bargaining chip in the high-stakes “fiscal cliff” negotiations, the measure could be a risky gamble with the health and finances of millions of ailing seniors, experts say.
Delaying program entry until age 67 would accomplish a top Republican desire to cut spending on Medicare, the popular but costly federal health insurance plan for the elderly.
The Congressional Budget Office estimates that slowly hiking Medicare’s eligibility age by two months a year – from age 65 in 2014 to age 67 in 2027 – would cut program spending by $148 billion over the next decade. But it also would lead non-Medicare health expenditures to increase, lowering the overall federal savings to $113 billion, the CBO found.
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In negotiations with Speaker of the House John Boehner, R-Ohio, to avert a series of tax increases and federal spending cuts dubbed the fiscal cliff, President Barack Obama already has offered $400 billion in Medicare spending cuts over 10 years. But he hasn’t said where the cuts would come from, leaving open at least the possibility that Medicare’s eligibility age could be in play.
An earlier budget plan offered by House of Representatives Budget Committee Chairman Paul Ryan, a Wisconsin Republican, also included a phase-in plan for raising the eligibility age.
In a letter to the president Thursday, 82 House Democrats urged him to oppose hiking the eligibility age, saying it would leave 270,000 seniors without insurance.
Raising the age also would increase out-of-pocket medical costs for those ages 65 and 66. That’s because they won’t have full coverage through Medicare until age 67, and would have to pay more for health coverage purchased on the new state insurance exchanges being established under the health care overhaul.
“Our nation’s older Americans have worked a lifetime for the promise of Social Security and Medicare,” the Democrats’ letter said. “For those 65- and 66-year-olds who would now be denied the security of Medicare, their out-of-pocket costs would increase by $3.7 billion.”
The Democrats cited a report by the Kaiser Family Foundation, a health-policy research and communications organization, that found that if the eligibility age went from 65 to 67 in a year, costs to states and the private sector would be nearly twice as large as the federal savings: $11.4 billion versus $5.7 billion.
Sen. Richard Durbin, D-Ill., said Thursday that the Obama administration had assured him that the eligibility age “is no longer one of the items being considered by the White House.”
But White House spokesman Jay Carney walked back Durbin’s comments, saying, “We’re not going to engage in hypotheticals about what a package would look like tomorrow on the spending cut side, negotiated with the Republicans.”
In an interview with ABC’s Barbara Walters that will be broadcast Friday night, Obama said it wasn’t clear that a higher eligibility age “saves a lot of money. But what I’ve said is, let’s look at every avenue.”
In last year’s negotiations with Boehner on raising the debt ceiling, news outlets reported that Obama had offered to raise Medicare’s eligibility age as part of a “grand bargain” in which Republicans would agree to certain tax increases.
There’s a precedent for doing so. Since 2000, the full retirement age under Social Security has risen gradually from age 65 up to age 66 for those born from 1943 to 1954, and up to 66 and 10 months for those born from 1955 to 1959. It rises to age 67 for those born in 1960 and later.