Should the Medicare Eligibility Age Be Raised? >
We Should Encourage Americans to Keep Working, Not Retire
Raise the age of eligibility of Medicare and tie it to life span
December 6, 2012
Let's start with a basic fact. We are not living in the 1930s. Therefore, the policies crafted to suit the conditions of the '30s are not responsive to the very different conditions that prevail today.
When President Franklin D. Roosevelt and the Congress enacted Social Security in 1935, the average life span was 62. Still, even the liberal Roosevelt administration set the normal retirement age above that level: age 65. When Congress and the liberal Johnson administration created Medicare in 1965, they still kept the normal retirement age of 65, even though the average life span had increased to 70.2 years.
[See a collection of political cartoons on Congress.]
Congress has since raised the normal retirement age for Social Security to 67. But Congress made no such change for Medicare, even though conditions changed. By 2009, the average life span was 78.2 years, and it is expected to reach almost 81 years in 2030.
During fruitless discussions with congressional leaders on raising the debt ceiling last year, President Barack Obama briefly joined a growing consensus of independent analysts who support gradually raising Medicare's age of eligibility to 67, tracking the Social Security change—by two months every year. The Congressional Budget Office estimated that such a change would yield a 10-year savings of $124 billion. Gradually raising the Medicare eligibility age to 68, as recommended by my colleagues at the Heritage Foundation, would yield a 10-year savings of $244 billion.
[See a collection of political cartoons on the budget and deficit.]
Ideally, Congress should gradually raise the normal age of eligibility for Medicare and Social Security to 68 and then tie it to average life span. Instead of encouraging Americans to retire, we should encourage them to keep working. For many older Americans, it will be an opportunity to live a healthier and happier life.
Rather than encourage some of our most resourceful and talented workers to go out to pasture, we should tap their talents and rich experience and increase America's productivity. Congress could help this along by providing tax relief for those who want to work beyond normal retirement age. With a Medicare reform based on a defined contribution to employer-based and other plans, Congress could also encourage older persons to keep their current health plans or purchase even better coverage.
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Corrected on 12/06/2012: A previous version of this article misstated the year Social Security was enacted. It was enacted in 1935.
- Other Arguments
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#111110
No — Pushing up the eligibility age will hike prices across the healthcare system
DEBRA WHITMAN, AARP Executive Vice President for Policy and International
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#25511
No — Raising the Medicare eligibility age brokers a political deal on the backs of elderly Americans
SY MUKHERJEE, Health Reporter for ThinkProgress
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#34711
No — Medicare eligibility changes wouldn't bring a savings, just a cost shift and cost increase
ETHAN ROME, Executive Director of Health Care for America Now
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#4249
No — Raising Medicare age only shifts costs to individuals and private employers
DAVID E. WILLIAMS, Cofounder of MedPharma Partners LLC,
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#51839
Yes — Retirement programs must be adjusted to reflect changing demographics
JAMES CAPRETTA, Visiting Fellow at the American Enterprise Institute
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