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A Medicare Buy-in Program

A Medicare Buy-in program has appeal as a way to expand coverage to people approaching the age of Medicare eligibility who may currently have difficulty accessing and affording good health coverage. Medicare is a well-known and popular program. For a buy-in to significantly reduce the ranks of the uninsured in the target population, key design issues need to be addressed—not the least of which is the availability of subsidies to make premiums affordable.

This Insight on the Issues, “A Medicare Buy-in Program” by PPI's Gerry Smolka and Sarah Thomas looks at the pros and cons of allowing adults in their 50s and early 60s to buy into Medicare as a way to expand their coverage options. It reviews the challenges this age group can face buying coverage and examines some of the recent Medicare buy-in proposals. The authors then explore some central design questions, including eligibility criteria and financing of the program (which will affect the cost and reach of a buy-in program), the adequacy of Medicare coverage (and whether supplemental coverage would be allowed), whether or not to have a national premium, outreach and enrollment, and the interaction with other, private coverage.

The authors concluded that, in the context of expanding access to affordable coverage options to older adults who are now either uninsured or pay high nongroup premiums for limited coverage, a Medicare buy-in might help people who are looking for affordable coverage, but only if the premiums are subsidized. Otherwise, the program is likely to be affordable only to those who are wealthy or those with high health spending, which will drive up program costs even further. Other design features will also affect attractiveness to the target population, take-up, and interaction with current sources of coverage. (14 pages)