Thursday, October 24, 2013

Raise Medicare Age To Save Cost? No Significant Savings, Says CBO

TPM's Sahil Kapur:
Raising the Medicare eligibility age to 67 saves far less than previously projected, a revelation that makes the policy far less attractive in upcoming deficit reduction negotiations in Congress.

The long-debated policy now cuts the deficit by just $19 billion over a decade, according to a report released Thursday by the nonpartisan Congressional Budget Office. Last year, the same policy -- of gradually lifting the eligibility age by two months every year until it reached 67 -- was found by the CBO to save $113 billion over the same time period.


Part of the reason for the low savings is Obamacare. Moving 66- and 65-year-olds off Medicare means they'll likely be eligible for federal subsidies or the expanded Medicare program under the 2010 law. But a larger part of the reason for the dramatic drop since last year, according to one expert, is that the CBO appears to have fixed a technical error.

"They were previously basing their estimates of the average costs of the 65-66 year olds who would no longer be on Medicare on the average costs of ALL 65 and 66 year old Medicare beneficiaries," said Loren Adler, the research director at the Committee for a Responsible Federal Budget, "which includes disabled and end stage renal disease beneficiaries who are clearly far more expensive than your average 65 or 66 year old."

(Bolds mine. - SB)

There was little enough reason to increase the Medicare eligibility age before the discovery of this error. Now you'd have to be crazy to support it... oh, wait; one could say "now you'd have to be Republican":
A top House Republican budget aide declined to comment.
Right. Admit your insanity by silence rather than admit the truth.

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