The Medicare Eligibility Age Debate Rages On

Some proponents of raising the Medicare age point out that the federal government introduced Medicare in 1965 primarily to guarantee healthcare to retired Americans.

At that time, the age of eligibility was set at 65 for Medicare and full Social Security benefits. By now, nearly half a century later, proponents point out that many Americans are retiring much later than 65 and remain eligible for employer health benefits until they decide to retire. While Medicare eligibility still begins at 65 for most Americans, eligibilty for full Social Security benefits has already risen slightly to 66 for people born until 1961 and 67 for people born after 1961. Because Social Security and Medicare aim to serve the same segment of the American population, proponents of raising the Medicare age often seek to tie Medicare eligibility to eligibility for full Social Security benefits.

There have been proposals to raise full Social Security and Medicare eligibility well beyond age 67 in order to trim federal spending. Age 70 is a round number brought up on occasion by those who seek substantial federal savings by cutting several years out of the Social Security and Medicare eligibility period for most Americans. The official Social Security Administration website, in examining the pros and cons of tying eligibility for full Social Security benefits to eligibility for Medicare, points out that “under a joint increase, people must consider the loss of both Medicare coverage and full Social Security benefits, whereas under an increase in just the retirement age, they must consider only the potential loss of Social Security benefits.”

Butler, in piecing together a scenario tying together full Social Security and Medicare eligibility, acknowledges this would require most Americans to stay in the workforce longer. Yet he sees this as a positive. Not only would Medicare benefit from the decrease in expenditures that would result from Medicare eligibility being shortened and people working longer, but “the wages or salaries for that extra time working would make retirement more financially secure for older people. It would also mean a more sensible balance between years in the workforce and years in retirement.”

Those suggesting seniors spend a few more years in the workforce before becoming Medicare-eligible at 67 often point out that most people working past age 65, and their spouses, will remain eligible for employer health benefits until they can join the Medicare rolls. Butler points out that for people over 65 who are too ill to continue working, “Medicare already provides health services for disabled Americans who qualify for Social Security disability payments. If we raise the Medicare eligibility age, we should make sure that older workers with special needs, short of full disability, can get coverage through Medicare.”

Raising the eligibility age for Social Security Disability Insurance is seen as a necessary step by some who favor an increase in the Medicare eligibility age. Some proponents of raising the Medicare age also suggest that Medicaid should also pick up some of the slack. Overall, proponents of raising the Medicare age suggest that, with a little resourcefulness, it is possible to ensure that few people get shut out of healthcare altogether as a result of 65- and 66-year-olds losing Medicare eligibility. Even the Social Security Administration, in presenting its scenario concerning what might happen if the Medicare eligibility age is raised to 70 by the year 2040, reports that “15.1 percent of the population aged 65 to 65 (2.79 million people) would retain their eligibility under DI [disability insurance] or ESRD” [end stage renal disease]. That number alone may not sound high, but supporters of raising the Medicare age suggest that if you combine it with percentages or totals of people who could continue coverage under Medicaid or employer private insurance packages, the vast majority of people 65 and over will not fall through the cracks if the Medicare age is raised.