The danger of expanding health insurance

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Moderate Democrats like Senators John Breaux of Louisiana and Bob Kerrey of Nebraska have once favored the gradual increase in the age of Medicare eligibility to help ensure the financial sustainability of the program. But few of them stay in Congress. Today, the “moderate” Democratic position is that the age of eligibility should be lowered as an alternative to establishing a single payer system. Senate Finance Committee Chairman Bernie Sanders is also in favor of opening Medicare to everyone over 60, but as a step towards a single payer.

The Democrats’ $ 3.5 trillion Senate budget plan allows final legislation to lower the age of eligibility. President Biden’s budget also approves the plan, which would cost $ 200 billion over 10 years and add more than 20 million young people in their sixties to the 63 million elderly and disabled beneficiaries already dependent on the program. It would also worsen the finances of the program, unnecessarily replace private money with taxpayer money, and harm doctors and other providers of medical services.

Medicare’s Part A trust fund, which pays for hospital benefits, is already expected to be insolvent by 2026. Even without expansion, Medicare spending is expected to nearly double over the next 10 years. The first priority for Congress should be to strengthen the finances of the program so that vulnerable older people can continue to access life-saving health care.

Democrats say it is necessary to expand medicare to reduce the number of uninsured Americans. But lowering the Medicare age of eligibility is an ineffective way to achieve this. Two-thirds of Americans aged 60 to 64 already have private coverage through an employer or the individual market. The plan could move up to 11.7 million people covered by the employer and 2.4 million people with individual coverage on Medicare lists, shifting the bill to taxpayers without extending coverage. Only 8% of the newly eligible population, or 1.6 million people, are currently uninsured. Two-thirds are already eligible for Medicaid or exchange grants, 15% have access to employer-provided coverage, and 7% are illegal aliens ineligible for Medicare.

Private payers pay significantly higher rates to hospitals and doctors, in some cases up to double Medicare hospital rates. Expanding government coverage at the expense of private coverage will make it more difficult for providers to continue to shift costs to better paid private patients. The result will be longer queues, less care and less incentive for innovation in treatment and care.


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