By Dan Berman
Bumping up the eligibility age for Medicare to 67 over the next decade would save less than $20 billion, far less than its own previous estimates, the Congressional Budget Office said Friday.
Total savings of $19 billion would be seen from 2016 through 2023 if eligibility for the health care program were increased from the current age of 65 over that time, the CBO said.
Previously, the office had calculated that savings would amount to $113 billion.
The CBO said its new analysis found that those who enroll at ages 65 and 66 tend to be healthier than those who sign up before that age, and thus are not as costly to insure. Also, more workers in that age group use employer health plans as their primary insurance, further limiting Medicare expenditures.
In 2011, when President Barack Obama and Congress were engaged in talks to produce a “grand bargain” budget deal, the president had indicated raising the age for Medicare enrollment was on the table. The bargain never happened.
See also: 5 tips for Medicare enrollment
The CBO based its analysis on a seven-year phase-in of the higher eligibility age, similar to how the age for receiving Social Security benefits has been changed. It concluded that Medicare expenditures would decrease by $23 billion over the period, while revenues would drop by $4 billion. The difference, $19 billion, was the net savings it expected.
Medicare spending would rise with the retirement of more baby boomers, reaching $1.1 trillion in 2023. In 2012, Medicare spent about half that amount. Currently, about 51 million people receive Medicare benefits, with about 80 percent being age 65 or older and rest covered because of disability.
Originally published on BenefitsPro.com