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Seth Korman Headshot

Raise the Medicare Age... But Let Under-67s Buy In

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AP Photo/Carolyn Kaster
AP Photo/Carolyn Kaster

One of the few cuts that Speaker Boehner and Republican budget negotiators have actually offered has been to raise the Medicare eligibility age, a move that on its own would save about $148 billion over the next 10 years, according to the CBO.

Opponents have rightly jumped on this as an increased burden on poorer Americans, who generally live shorter and unhealthier lives and have fewer resources to pay for additional years of private insurance. They also point out that an increased eligibility age would actually cost Americans more money, as seniors in the 65-to-67 age group would spend nearly twice as much on private care compared to what Medicare would have otherwise spent.

Fortunately, in this debate, and in the spirit of actually finding some middle ground in these fiscal cliff negotiations, I propose a simple compromise:

Raise the Medicare eligibility age, but let those under 67 buy into the program.

In fact, if Democratic negotiators want to be really shrewd, why not take it step further, attack from the right, and offer to raise the age of eligibility even higher, but with the major caveat that anyone can buy into Medicare? And to pay for this move? Hell, why not steal another idea from the right's playbook: vouchers, though means-tested.

So here's how it would work: The poorest Americans of a certain age receive a voucher that covers 100 percent of their Medicare premiums (at present they'll receive tax subsidies through the ACA that have the same effect). So no change there. Then, the wealthier the beneficiary, the smaller percentage of premiums the federal government covers, up to a certain point.

Sure, such vouchers (or premium support, or whatever you want to call it) will cost money, and thus such a move will not save the full $148 billion. But savings should still be substantial (from the decreased outlays to and increased revenue from wealthier seniors, not to mention the savings from a larger Medicare). In short, everyone seems to win.

Now of course there are the counterarguments. First, this is in part a stealth tax on the wealthy, as it asks them to pay more for Medicare (or private insurance). But so what? Taxes on the wealthy are going up as it is, and if Republicans are so adamantly opposed to rate increases, this seems like a way to increase revenue from the wealthy without raising rates.

Second, this would require an expansion of Medicare, an idea anathema to conservatives (yet incredibly popular with the American public, at least according to some polls). Republicans would likely object to any expansion of Medicare on purely ideological grounds. But would the offer of some means-tested voucher system provide a sufficient bargain for the expansion of a "public option"?

Finally, healthcare providers might push back, as increased Medicare rolls would cut into their profits. But again, wasn't a major piece of healthcare reform to decrease costs?

In short, what we'd have here is compromise. Republicans give on allowing an expansion of Medicare and some increased taxes on the wealthy, while Democrats allow Medicare's age of eligibility to increase and accept some form of voucher (which, in reality, the ACA has already partially adopted, at least for poorer Americans).

Sure, this alone won't solve our entire budgetary problems, but it does make some headway, and demonstrates that compromise may be possible. And after all, isn't compromise what the American people really want?