The likely Democratic nominee has suggested that people should be able to opt into the public health program for senior citizens before retirement age, perhaps at age 50 or 55.
Clinton reasons that Medicare could provide care to middle-aged Americans cheaper than private insurance due to the sheer size of its pool of beneficiaries. Having younger workers and retirees help fund the program through premiums might also help offset the high costs Medicare incurs to care for the oldest and sickest beneficiaries.
If it’s not clear how the partial “public option” would be paid for by the federal government, and whether the deal extended to pre-retirees would differ from that offered to those over 65, it is clear that many companies would welcome the prospect of no longer having to provide coverage for their oldest employees and retirees. Companies that offer coverage to retirees under the age of 65 pay an average of $13,000 for the plans, according to a recent study by Mercer.
“Employers would like that because it would cost them less than what it costs them for pre-65 people today,” Derek Guyton, a partner at Mercer health and benefits, told Forbes columnist Bruce Japsen. “Employers like giving more choices.”
Companies have already begun ditching retiree coverage in response to rising health costs in recent years. According to Mercer, the percentage of employers that offer pre-Medicare retiree health plans has dropped from 46 percent in 1993 to 28 percent today. The percentage that offer some type of health benefit to Medicare-eligible retirees has similarly declined from 40 percent to 21 percent.
Throughout the race for the Democratic nomination, the former secretary of state has dismissed calls from her opponent, Bernie Sanders, to establish a single-payer, “Medicare-for-all” health care system as unrealistic. And yet, her recent proposal appears to go about half of the way towards the vision the Vermont senator is calling for.