Elder law attorneys keep a finger on the pulse of laws that impact programs for seniors. Changes are always possible via legislative mandate, and now that there is a new power dynamic in Washington, we may see movement over the coming months and years.
With this in mind, an attention-getting proposition has been presented that would significantly impact the Medicare program, and will take a look at it here.
Eligibility Age
You earn retirement credits that lead to Medicare eligibility when you work and pay FICA or self-employment taxes. In 2021, you get one credit for every $1470 that you earn, and you can accumulate up to four credits in a calendar year.
Once you have 40 credits, you will qualify for Medicare when you reach the age of eligibility. At the present time, you will qualify for Medicare coverage if you have 40 credits when you are 65 years of age.
President Joe Biden proposed a reduction in the Medicare eligibility age when he was a candidate, and he has not wavered. He still wants to see the age go down to 60, and Senator Bernie Sanders has proposed a reduction to 55, so there is room for compromise.
Expanded Coverage
Sanders would like to include some additional changes that would benefit older Americans: he wants Medicare to cover dental, vision, and hearing care. There would be negotiations with drug companies to lower prices, and the savings would pay for the expanded coverage.
Earlier Detection and Treatment
The baby boomer generation is attaining senior citizen status, so there is an unprecedented aging of the population underway. Millions of people would be impacted by a reduction in the Medicare eligibility age over the coming years.
Health insurance is quite expensive for people that are in their 50s and early 60s, and there are those that simply cannot afford it. Clearly, when you are in this age group, it gets more and more likely that you will experience a serious medical condition.
Many people try to wait it out until they are 65 years of age, and unfortunately, the inaction can be deadly. A study that was conducted at Stanford University has found that cancer diagnoses are disproportionately higher among people that are 65 years of age and older.
Researchers hypothesize that this phenomenon stems from the fact that a lot of people that have undiagnosed cancer do not go to doctors because they have no insurance coverage.
Financial Implications
In addition to the impact on the uninsured, there are people that are currently paying for coverage would save a great deal of money.
The Kaiser Family Foundation does a lot of healthcare research, and they have put the subject under the microscope. A 60-year-old individual that is earning $50,000 annually would pay about $4400 a year for a silver level plan that is purchased through the ACA exchange.
Aside from the fact that premiums plummet if you can switch to Medicare, the out-of-pocket expenses are not as high as the expenses that you have to pay if you have private insurance.
Public Sentiment
There will definitely be some serious pushback from people within the healthcare industry, because a Medicare eligibility expansion could lead to lower rates for providers. There is also an argument that more people will retire early, and this will harm the economy.
Apparently, the average person on the street does not share these concerns. Another Kaiser poll found that 69 percent of American Republicans and 85 percent of Democrats are in favor of lowering the Medicare eligibility age to as young as 50.
We Are Here to Help!
This is an evolving situation that will be interesting to follow, but in the meantime, you should develop a plan for aging that leads to the appropriate passing of your legacy. If you are ready to get started, we are here to help.
You can schedule a consultation at our Los Angeles, California estate planning office if you call us at 310-337-7696. There is also a contact form on this site you can use if you would prefer to send us a message, and if you reach out in this manner, you will receive a quick response.
- Consider Taxation When You Choose a Retirement Destination - October 21, 2021
- Why Do You Need an Estate Plan? - October 19, 2021
- Consider the Impact of Alzheimer’s Disease - October 18, 2021
