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Democrats roll out Medicare buy-in proposal

Posted: 10:28 PM, Feb 13, 2019
Updated: 2019-10-07 13:14:28-04

Highlighting the divide facing Democrats in expanding health insurance coverage via Medicare, a group of lawmakers Wednesday reintroduced bills that would allow Americans to buy into the program at age 50 -- rather than giving everyone access.

The legislation, spearheaded by Sen. Debbie Stabenow of Michigan and Rep. Brian Higgins of New York, is a more moderate approach to promoting affordable coverage -- a main goal of the Democrats and a key plank in the 2018 midterm elections.

The bill's co-sponsors include 2020 Democratic hopefuls Sens. Cory Booker of New Jersey, Kamala Harris of California and Amy Klobuchar of Minnesota, as well as Sens. Kirsten Gillibrand of New York and Jeff Merkley of Oregon, who are considering bids. Several of them, including Booker, Gillibrand, Harris and Merkley, also backed Sen. Bernie Sanders' 2017 Medicare for all legislation.

The advantages of the buy in approach, sponsors say, is that it could be enacted quickly -- unlike Medicare for all, which would greatly overhaul the nation's health care system.

"It could happen now if it passed, using the current system -- a trusted system -- with those individuals who are most struggling right now in terms of health care costs," Stabenow said.

The Medicare buy in bills, versions of which have been introduced previously, would let Americans ages 50 to 64 purchase Medicare plans through the Affordable Care Act exchanges. Enrollees would cover the premiums, so it would not require federal government funding. However, lower- and moderate-income participants could qualify for Obamacare subsidies to help defray their costs.

Medicare, however, typically has much lower deductibles than exchange plans, but doesn't offer all of the same protections. Consumers would have to buy separate Part D plans to cover prescription medications or enroll in Medicare Advantage plans, which are offered by insurers and provide drug benefits.

Also, enrollees may have to purchase supplemental Medigap policies to shield them against high out-of-pocket costs since, unlike Obamacare plans, Medicare doesn't have an annual or lifetime cap. All of this additional coverage would be available to those age 50-plus on the exchanges.

The bills have not been analyzed by the Congressional Budget Office, but Higgins' office said premiums would have been around $8,200 in 2017, about 40% lower than a Gold plan for a 60-year-old on the Obamacare exchange. This would include drug coverage.

Supporters also argue expanding Medicare access will strengthen the Obamacare exchanges since older Americans, who are often sicker and costlier, will be shifted to Medicare. This should reduce premiums for those remaining in Affordable Care Act plans.

The buy in bills would retain the private insurance system -- a source of controversy within the movement to expand coverage. Many of those supporting Medicare for all want to eliminate the industry, but many Americans like their plans, leading some candidates to shy away from calling for the demise of insurers.

A recent Kaiser Family Foundation poll found that 77% of respondents favor the Medicare buy in approach, compared to 56% who support Medicare for all.

At least one major hospital group, however, opposes the bill. The Federation of American Hospitals, which represents investor-owned or managed hospitals, said that it will hurt consumers because Medicare's low rates will squeeze care providers.

"There is no question that Medicare works for seniors and others who depend on it," said Chip Kahn, the federation's president. "But expanding the program with hospitals facing the lowest Medicare margins in history will make it more difficult to provide the critical care that all Americans expect and deserve. Instead of focusing on Medicare buy-ins and other variations of single-payer proposals, Congress should work to sustain and expand affordable private coverage."