Health insurance for the country’s aging population could change if Joe Biden wins the November presidential election.
The Democratic candidate wants to expand both Medicare coverage and eligibility to the program, as well as ease the cost of prescription drugs. At the same time, however, there are challenges.
First, Medicare funding is under pressure as revenues decline during the economic downturn caused by the pandemic. According to experts, the fund supporting Medicare Part A (hospital coverage) may be fundamentally insolvent – meaning its income will not be enough to cover expenses – for several years before 2026.
“This requires Congress and the next president to step in and ensure that Medicare is able to meet its future responsibilities,” said Tricia Neuman, director of the Kaiser Family Foundation’s Medicare Action Program.
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Of particular concern to Medicare supporters is President Trump’s demand to suspend payroll taxes that go to fund both Medicare and Social Security. Earlier this month, he said he would make it permanent if he was re-elected.
“A payroll vacation may seem like good news for a person in the short term, but it’s the main way to fund both Medicare Part A and Social Security,” said Judith Stein, CEO of the Medicare Advocacy Center. “If he made the holiday permanent, we would have lost [those programs]. “
In addition, the Supreme Court is due to hear arguments in November – a week after the November 3 presidential election – in a case seeking to repeal the Affordable Care Act (aka Obamacare). While this law tends to focus on extending health care coverage to more Americans, it also made some Medicare changes that will benefit recipients.
For example, the law added certain free preventive benefits to Medicare. It also eliminates the increase in the cost of prescription drugs faced by some beneficiaries over several years.
“It’s not entirely clear how a complete dissolution of the ACA would affect Medicare,” Neuman said. “But there is a real risk that it would increase the cost to retirees, cause major disruption to health care providers and exacerbate the solvency challenges facing the Medicare Part A fund.”
In addition to local challenges, here’s what can happen if Biden is elected and succeeds in reforming Medicare.
Under current law, people can usually get Medicarea on their 65th anniversary. The majority of the program’s 62.5 million beneficiaries are of that age or older (the rest are young people with disabilities or people with end-stage kidney disease).
Medicare is not free. However, as long as you have at least 10 years of work history paying for the program, Part A — again, hospital coverage — has no fees. Part B, which covers outpatient care, has fees, and higher wage earners pay more. The coverage of prescription drugs in Part D is the same. These two parts of Medicare are largely financed by insurance premiums and general revenue (not from a special fund in difficulty).
And there are other pocket costs, such as deductibles and fees. Many beneficiaries turn to private insurance companies for Medicare Advantage plans or so-called
Biden wants to reduce Medicare’s eligibility age from 60 to 65, and optional enrollment for that 5-year period. The change is financed by general revenue.
The cost is estimated at $ 200 billion over the decade, said Marc Goldwein, policy director for the responsible federal budget committee. However, he said, the price tag could be much lower.
“The gut is that it’s a top-notch estimate,” Goldwein said. “Healthcare coverage is quite high already in that age group.”
He also pointed out that Biden wants to create a public health insurance option and expand coverage through health care exchanges. These options may end up being better for them than Medicare, he said.
Biden specifically wants Medicare to cover teeth, sight and hearing, all of which are currently excluded. To do this, beneficiaries can sign up for a Medicare Advantage Plan, which can provide some coverage.
Lower prescription drug costs
Biden also wants to reduce what Medicare beneficiaries pay for prescription drugs, particularly by allowing the government to negotiate prices – which is currently prohibited by law. The Congressional Budget Office has estimated that such a transfer would save $ 456 billion between 2023 and 2029 (based on a bill in Parliament that would make a change).
At the same time, however, a report by the Budget Office stated that negative effects could include reductions in research and development spending.
Biden also denies rising prices for most drugs faster than inflation.
A couple of other ways he recommends to lower the cost of medicines for the elderly are repeated by the methods Trump proposed: limiting funding to Medicare Part D prescription drugs and importing prescriptions from consumers with guarantees.
Trump has taken several steps to lower drug costs, including removing “gag prescriptions” from pharmacies that forbade them from telling patients that their prescription was cheaper. He also limited the monthly insulin costs, which are in effect next year, for some Medicare beneficiaries.
Experts warn that the most urgent thing for people who end up in the White House is the solvency of the mutual fund.
“If they’re going to do something with health care, I’ll start by recording Medicare Part A,” Goldwein said in the responsible federal budget committee.