Most seniors can't pony up more for health care
A new Kaiser Family Foundation tool shows the harsh reality of trying to shift more Medicare costs to already-strapped seniors.
This post comes from Krystal Steinmetz at partner site Money Talks News.
If you think seniors can afford to pay more for Medicare, let's take another look at that thought.
Why is this important? House Republicans have been calling for an end to traditional Medicare, instead favoring a voucher program where seniors pay for private plans. The latest proposal would give seniors a choice of using a government subsidy to either buy private insurance or pay for Medicare premiums in 2024.
Many believe a subsidy program would shift more health care costs to seniors over time. Also, if new retirees picked private insurance, traditional Medicare would become much more expensive for those who continued to use it because they'd likely be older and in poorer health.
"The Congressional Budget Office has estimated that this effect could boost traditional Medicare premiums 50 percent by 2020 compared with current projections," Reuters said.
Seniors covered by Medicare are already paying for a chunk of their health care costs. According to the Employee Benefit Research Institute (.pdf file), Medicare covered about 62 percent of health care costs for seniors in 2010. Private insurance covered 13 percent and seniors paid 12 percent of costs.
Out-of-pocket health care costs totaled about $4,760 in 2011 for a 65-year-old in poor health and $4,450 for a 65-year-old in good health, according to U.S. News & World Report. By age 75, those numbers increased to $5,635 for someone in poor health and $5,220 for a senior in good health.
HealthView Services, which develops software for gauging health care costs, recently estimated that a senior retiring this year in high-cost Massachusetts would pay $7,020 in Medicare premiums alone – a number that will jump to $11,536 in 2024. And that figure doesn’t include co-pays and out-of-pocket costs for things Medicare doesn’t cover, such as dental care. It also doesn’t include costs for a catastrophic event.
So, can seniors afford to pay more? Check out a new interactive Medicare recipient income and assets tool from the Kaiser Family Foundation to find your answer. Reuters did. Among the results:
- Fifty-three percent of Medicare recipients had $25,000 or less in annual income in 2013. Just 4 percent had income of more than $100,000. And nearly 27 percent had income below $15,000.
- Half of seniors had savings accounts with less than $61,400 and home equity below $67,700 on a per-person basis.
- "Median 2013 per capita income for white Medicare beneficiaries was $26,400, compared with $16,350 for African Americans and $13,000 for Hispanics," Reuters said. While men's median income was $25,880, women's income was $21,800.
Kaiser told Reuters that just 5 percent of Medicare recipients will have income of more than $111,900 in 2030, while half will have less than $28,250 to live on."
"There will always be a small share of the Medicare population with sufficient wealth and resources to absorb higher costs, but most will not be in that position," (KFF executive Tricia Neuman) says. "The assumption that boomers are healthier and wealthier and that we'll have a much rosier Medicare outlook down the road just isn't going to happen."
Do you support attempting to shift Medicare's growing costs to seniors?
More from Money Talks News
Do whatever you like.
Note to hospital:
When I'm broke, good luck getting your money.
Note that Ryan, Boehner, etc. KNOW that Medicare delivers 13.3% more for the buck than private insurance. How do they know that? Medicare Advantage is offered by private companies who cried to Congress that they couldn't provide the same services as Medicare B unless they were paid 13.3% more than Medicare spends per patient. And that was before Obamacare when all the "uninsurables" were on Medicare B.
Note that Paul Ryan gets about 25% of his campaign contributions for insurance and related PAC's and other organizations.
one week MSN tells us its the babyboomers with all the money, and that they are hoarding it, the next week MSN says that the babyboomers/elderly are poor and can't pay for their health insurance.
WTF. Which one is it MSN?
This is far-left-wing silliness of the worst kind: illogical, demagogic, creating an issue where none exists, instigating class warfare, and wrong on the facts. It tells you a lot about Krystal Steinmetz, MSN, Kaiser, Reuters and the other lefties quoted in this article that they consider this financial planning information and not political opinion. Although there is an error in almost every sentence, the worst errors, omissions and misstatements in order of importance are as follows
1. Today, about 20% of people on Medicare get all kinds of financial help and no one is proposing a change to that assistance. The elderly poor that the writer says are in such dire straits are not in that circumstance because of Medicare costs (in fact, some are there purposely; it is called spend down). Their Medicare is free.
2. Many middle income seniors are helped substantially in their drug costs by state pharmaceutical assistance programs and a Federal program started by George W. Bush called Extra Help.
3. The “new” interactive Kaiser tool highly touted in this article is about 20 years old and the breathless facts written about here are based on 10-year old data.)
4. Of course seniors have higher healthcare expenses than younger people. Duh! But the data about Massachusetts in this article is totally false. The highest anyone in Massachusetts on Medicare could possibly pay is under $4000 (not over $7000) even if they picked the most expensive Medigap and Part D plans. And there are dozens of much lower cost options (I pay under $2000 for excellent insurance)
5. No one is currently proposing removing fee for service Medicare; as bad as it is. (It's so bad only about 3% of we Medicare beneficiaries currently depend on it. All the rest of us on Medicare make -- mostly private -- supplemental insurance arrangements to cover our healthcare costs in retirement.) Those that want crappy Original Medicare with its high co-pays and lack of out of pocket spending protection will still be able to buy it under all current proposals that I am aware of
6. No one is proposing private policies for seniors; all Parts of Medicare -- A, B, C and D -- are public. No one is proposing that be changed. All Parts of Medicare are currently administered by private insurers.
7. No one has proposed Medicare vouchers anytime this century
Copyright © 2014 Microsoft. All rights reserved.
ABOUT SMART SPENDING
LATEST BLOG POSTS
VIDEO ON MSN MONEY
BLOGS WE LIKE
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'