Nature of the Issue
Health care reform offers the opportunity to help reduce the financial and health risks currently faced by millions of adults ages 50 to 64.
In 2007, nearly 55 million adults were in their 50s and early 60s. The aging of the baby boomers will push the size of this age group to nearly 63 million, more than 19 percent of the population, by 2015.
The rising cost of health care has made access to adequate, affordable health care coverage problematic for many in this age group. Without sufficient coverage and treatment, they face the prospect of declining health and insufficient care—and these consequences will follow many of them into Medicare.
To address the needs of older adults, health care reforms must focus on challenges that have only been heightened by the current economic crisis.
· One in four older adults spent 10 percent or more of disposable family income on health care in 2005, compared with one in six adults ages 18 to 49. Out of pocket spending of 10 percent is roughly double what those with employer coverage spend on health.
· Two-thirds of those buying coverage in the individual market spent at least 10 percent of their disposable family income on health. Their average spending on premiums was three times that of their peers with employer coverage.
· Medicaid and Medicare provide important coverage to 13 percent of this age group, but even with public coverage, spending for some was high. 38 percent of those with public insurance still spent at least 10 percent of their income mainly for health care.
· 7.1 million adults ages 50–64 were uninsured in 2007—1.9 million more than in 2000.
Impact on 50+ Americans
For older adults having adequate and affordable coverage is central to their health and financial security. Getting access to such coverage is important for those without it and maintaining access to adequate coverage that provides adequate financial protection is important for those currently covered. Too much exposure to cost can lead people to forgo needed health care, which can affect their health and raise Medicare spending.
AARP’s Position
AARP want reforms that assure everyone has access to adequate and affordable health coverage, including adults ages 50 to 64.
To successfully respond to the cost and coverage problems faced by adults in their 50s and early 60s, reforms will need to:
· Address the cost burden so that health spending is manageable and does not threaten older adults’ current and future financial security
· Find workable solutions so that everyone, regardless of age and health status, has access to affordable and comprehensive coverage
More specifically, reforms need to address the following concerns:
· Access to coverage for those not covered through an employer
· Cost and access barriers that adults in their 50s and early 60s face in the private individual market
· Absence of a backstop for many who cannot obtain or afford private coverage
Reforms that rely on the private market need to ensure that
· Markets make good, comprehensive coverage available at premiums affordable to everyone, regardless of age or health status
· Subsidies intended for use in the private market reflect the realities of market pricing and the higher costs faced by adults who are older and adults who have health problems.
Likewise, reforms that look to public programs to improve access to coverage need to take the financial situation of the target populations into account in their design, so that
· Any premium and cost-sharing obligations are not barriers to participation and wise use of care.
Policies that fail to take current realities into account will continue to impose a larger cost burden on those older adults with modest incomes and those who need regular health care.