SalemNews.com, Salem, MA

Nation/World

December 6, 2012

Trade-offs in raising Medicare eligibility age

WASHINGTON (AP) — Americans are living longer, and Republicans want to raise the Medicare eligibility age as part of any deal to reduce the government’s huge deficits.

But what sounds like a prudent sacrifice for an aging society that must watch its budget could have some surprising consequences, including higher premiums for people on Medicare.

Unlike tax hikes, which spawn hard partisan divisions, increasing the Medicare age could help ease a budget compromise because President Barack Obama has previously been willing to consider it. A worried AARP, the seniors’ lobby, is already running ads knocking down the idea as a quick fix that would cause long-term problems. House Democratic Leader Nancy Pelosi, D-Calif., doesn’t like it either.

But for Republicans seeking more than just tweaks to benefit programs, raising the current eligibility age of 65 has become a top priority, a symbol of their drive to rein in government. If Obama and the GOP can’t agree soon on a budget outline, it may trigger tax increases and spending cuts that would threaten a fragile economic recovery.

Increasing the eligibility age to 67 would reduce Medicare spending by about 5 percent annually, compounding into hundreds of billions of dollars over time. But things aren’t that simple.

“This is a policy change that seems straightforward, but has surprising ripple effects,” said Tricia Neuman, a leading Medicare expert with the nonpartisan Kaiser Family Foundation. “It’s a simple thing to describe, and the justification is that people are living longer, but I don’t think people have thought through the indirect effects.”

Among the cost shifts identified in a Kaiser study:

Higher monthly premiums for seniors on Medicare. Their costs would go up because keeping younger, healthier 65- and 66-year-olds out of Medicare’s insurance pool would raise costs for the rest. The increase would be about 3 percent when the higher eligibility age is fully phased in.

Text Only | Photo Reprints
Nation/World

Local News
  • 140765_SN_DLE_FESSENDEN4 Special Spaces transforms two downstairs rooms into playroom for Riley Fessenden

    BEVERLY -- What happens when the perfect kid-friendly playroom appears in your house overnight? Beverly's Fessenden kids were mostly speechless when they returned from seeing "The Little Mermaid" on Saturday and got their first look at the playroom t

    July 28, 2014 10 Photos

  • Beverly Hospital courier loses patients’ lab forms

    BEVERLY -- A courier for Beverly Hospital last month lost lab request forms for 54 patients that included names, health insurance identification numbers and, in some cases, Social Security numbers. The courier misplaced the forms, which were in a zip

    July 28, 2014

  • Big plans for three parks in the Point neighborhood SALEM -- One will be overhauled, another created from scratch, and a third will get a spiffed-up community garden. It's a good time to be a park in the Point neighborhood. The densely packed area just south of the city's downtown is on the verge of i

    July 28, 2014

  • Peabody could see school choice profit next year PEABODY -- After three years, the city's schools are projected not only to break even on school choice, but actually make a $30,000 profit. School officials expect to lose just under $300,000 in state aid next year for students who opt to attend scho

    July 28, 2014

  • 140723_SN_DLE_SALVARMY2 Dennis and Susan Knight take over Salem Salvation Army operation

    SALEM -- It was Christmas Eve in Sanford, Maine, but 8-year-old Dennis Knight and his three sisters had good reason to be short on holiday spirit: Their mom and dad had warned them there would be no Christmas that year. The family couldn't afford it.

    July 28, 2014 3 Photos