Davidoff A, Johnson R; Academy for Health Services Research and Health Policy. Meeting.
Abstr Acad Health Serv Res Health Policy Meet. 2001; 18: 83.
Health Policy Center, The Urban Institute, 2100 M Street N.W., Washington, DC 20037, Phone: (202) 261-5259, Fax: (202) 223-1149, E-mail: adavidof@ui.urban.org
RESEARCH OBJECTIVE: Rising costs are likely to generate renewed calls to delay the Medicare eligibility age to 67. A buy-in option to Medicare has been proposed to mitigate the impact of a restriction in eligibility. This paper examines the effects of an increase in the Medicare eligibility age, with and without a buy-in option, on insurance coverage and retirement decisions for Americans ages 65 and 66.STUDY DESIGN: This study uses data from the 1998 Health and Retirement Study, supplemented by non-group insurance premiums collected over the internet from insurance providers and matched on the basis of age, gender, health status, and smoking behavior. We explicitly model the decision to retire, since the availability of Medicare affects labor supply which in turn affects employer-sponsored coverage. We also model decisions to seek Medicare disability and to purchase non-group coverage. We use the results of the three models, in combination with information on Medicaid eligibility, to simulate the effects on insurance coverage of a delay in the age of Medicare eligibility from 65 to 67. We also simulate the delay in eligibility with a Medicare buy-in at various premium levels.POPULATION STUDIED: Non-institutionalized U.S. adults ages 65-66.PRINCIPAL FINDINGS: With a delay in Medicare eligibility until age 67 without a buy-in option, we simulate that 56 percent of affected adults would have coverage through their own or spouses employer, 16 percent would have Medicaid or Medicare disability, 10 percent would have a comprehensive non-group policy, 9 percent would have a limited non-group policy, and 9 percent would be uninsured. Uninsurance rates would be 26 percent among the poor and 6 percent among those with two or more health problems. If a Medicare buy-in were available at $300 per month, 13 percent would participate, reducing non-group purchase by 12 percentage points and uninsurance by only 2 percentage points. If premiums were related to income, participation in the buy-in would increase to 17 percent and uninsurance rates would drop to 4 percent.CONCLUSIONS: Most 65 and 66 year olds would find alternative sources of insurance if the Medicare eligibility age were delayed. A Medicare buy-in would attract many participants, but many would have purchased non-group coverage in the absence of a buy-in plan. The buy-in would not reduce uninsurance substantially unless premiums were income related.IMPLICATIONS FOR POLICY, DELIVERY, OR PRACTICE: Delay in the age of eligibility for Medicare would increase uninsurance among vulnerable groups. A Medicare buy-in would be essential to reduce the burden of this reduction in coverage. However, targeted subsidies based on income would be needed to reduce uninsurance among low-income populations. Adverse selection problems would complicate efforts to make the program cost neutral. General subsidies would be required to keep the buy-in affordable.PRIMARY FUNDING SOURCE: Henry J. Kaiser Family Foundation
Publication Types:
Keywords:
- Adult
- Aged
- Case-Control Studies
- Disabled Persons
- Eligibility Determination
- Humans
- Income
- Insurance Coverage
- Insurance, Health
- Medicaid
- Medically Uninsured
- Medicare
- Poverty
- Retirement
- United States
- economics
- hsrmtgs
Other ID:
UI: 102273313
From Meeting Abstracts