Some potentially big news via TPM’s Sahil Kapur:
Raising the Medicare eligibility age to 67 saves far less than previously projected, a revelation that makes the policy far less attractive in upcoming deficit reduction negotiations in Congress.
The long-debated policy now cuts the deficit by just $19 billion over a decade, according to a report released Thursday by the nonpartisan Congressional Budget Office. Last year, the same policy — of gradually lifting the eligibility age by two months every year until it reached 67 — was found by the CBO to save $113 billion over the same time period.
The idea has been floated since 2011, when President Barack Obama and Speaker John Boehner nearly agreed to a broad debt deal that adopted it. But while conservatives still support the policy, along with deeper long-term cuts to retirement benefit programs, the White House and top Democrats have since cooled to it.
“This would have been a tough sell when it raised $100 billion. It’s hard to imagine making such a drastic change now that we know it saves far less,” said a senior Senate Democratic aide, in response to the CBO report.
One reason for the adjustment is that many of those denied eligibility for Medicare at 65 would likely qualify for Obamacare subsidies, which would reduce the savings. Another involves a technical glitch in prior estimates—they measured average costs for relatively health people by using data from a cohort that includes the disabled, who aren’t going anywhere.
Now that it’s not a big cash cow, the Medicare benefits for 65-67 year-olds probably just got a lot safer.
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