Raising Medicare's eligibility age: How much money would it save?
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Kaiser figures that employer retiree health-care costs would go up by $4.5 billion annually in an age-67 Medicare regime. Out-of-pocket costs for 65- and 66-year-olds would collectively increase by $3.7 billion a year.
“Given the magnitude of the changes that we estimate would occur by raising the Medicare eligibility age, this analysis underscores the importance of carefully assessing the distributional effects of various Medicare reforms and savings proposals to understand the likely impact on beneficiaries and other stakeholders,” concludes the Kaiser Foundation study.
“Medicare’s unfunded promises in current dollars reach into the many tens of trillions of dollars,” write the Heritage Foundation’s J.D. Foster and Alison Acosta Fraser in a November study of entitlement reforms.
Social Security is already slowly raising its eligibility age to 67, note Foster and Fraser. Waiting five years, then starting to gradually align Medicare’s and Social Security’s eligibility rules, would bring the government incentives for workers to retire into alignment.
“The long-term savings in Medicare would be profound,” they write.