When Medicare was enacted 55 years ago, the minimum eligibility age was selected to match the full retirement age of 65 for Social Security. Prior to Medicare, the elderly were the most likely to be in poverty, had medical expenses twice as high as those under 65, and only half of retirees had any source of health coverage. Together, Social Security and Medicare are crucial to protecting the health and financial security of over 60 million older people and younger people with a disability.
Many proposals to address the underlying challenges of inequitable access to affordable, high-quality health coverage and care and containing health care spending, build upon the Medicare program, including Vice President Joe Biden’s health care proposal that lowers the Medicare eligibility age to 60.
The Academy’s March 2020 report on Medicare eligibility provides an overview of the policy design issues and potential impacts of three major eligibility changes: extending Medicare coverage for all; creating a Medicare buy-in; and lowering the age of Medicare eligibility.
Impacts of adopting a lower eligibility age could include:
- Expansion of coverage: Decrease in the U.S. uninsurance rate by 3 percent (670,000 individuals) to 19 percent (4.6 million individuals) depending on new eligibility age (62, 55, or 50). The uninsured share may increase among young adults if premiums increase in the individual market.
- Improve access: Increase the comprehensiveness of coverage available to many new beneficiaries; Reduce financial barriers to access to care for individuals previously enrolled in private plans, without or with limited cost-sharing assistance.
- Increase affordability: Potentially reduce out-of-pocket burden for some new beneficiaries. May modestly reduce the affordability of coverage in the individual insurance markets. Generate savings to employers and state Medicaid programs.
- Contain costs: More likely to improve overall U.S. health cost containment as more individuals are covered by Medicare and a greater share of providers receive Medicare rates. Shift responsibility for financing coverage to federal government, increasing costs to the Hospital Insurance Trust Fund and the federal budget.
- Improve equity Reduce racial and ethnic disparities in the new enrollee population.
The report found that proposals to adapt Medicare to extend coverage to new beneficiary populations present a significant set of technical and program design considerations. Learn more and download additional resources.
Examining Approaches to Expand Medicare Eligibility: Key Design Options and Implications (2020) is the culmination of over 10 months of extensive deliberations among 27 members of the Academy’s Study Panel on Medicare Eligibility, co-chaired by Marilyn Moon and Cori Uccello.