'Medicare at 55' is a better bet than 'Medicare for All'

'Medicare at 55' is a better bet than 'Medicare for All'
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Trump’s decision to put health-care reform on hold until at least 2020 signifies another two-plus years of rising costs for Americans who are already living paycheck to paycheck.

Rather than sitting idly by, to tame rising health-care costs, there are measures we can take now that work in tandem with the Affordable Care Act or any future program that might replace it.

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So long as Medicare exists, there’s an economically viable way to extend it to more Americans at little or no net cost to the government, which will ultimately control otherwise rising health-care costs. 

Over the last two years, I have been speaking with Americans across the country who have definitively said the most important issue to them is rising health-care premiums and deductibles on their existing health-care insurance. 

There is a way to alleviate this issue at little net cost to the government: "Medicare at 55." With it, we can extend Medicare and Medicare Advantage to people between 55 and 64 years of age. People will have the option, not the obligation, to switch. 

When they switch, employer plans will be left with younger and healthier employees, taking pressure off rising premiums and deductibles. Those may even have room to move lower. 

Medicare at 55 is important, timely, and politically feasible, which means it can deliver significant relief soon. This highlights one of the real problems with “Medicare for all," which has recently been trumpeted by so many 2020 presidential contenders. It’s simply not something we can get done in any near-term timeframe, and Americans need help now. 

After the 2016 election, I was distressed. I wondered what my party, the Democratic Party, had missed; what the most pressing needs of voters truly were; and whether we even knew those needs. That election was an eye-opener that the party was out-of-touch with what really mattered to voters.  

So, for the last two years I’ve been having direct, personal discussions with middle-class voters from around the country, from both parties. I’ve conducted 30 voter roundtables in eight states with Republicans, independents and Democrats, with participants' household incomes generally ranging $40,000-$80,000.

I’ve asked:

  • "What is the job market like for you?"
  • "What are your prospects for advancement?"
  • "How is your health insurance working?" 
  • And, "How do you feel about immigration, climate change, and terrorism?"

I've found that the Democratic Party needs a laser-like focus on the immediate needs of the middle class. So why is it that so many 2020 Democratic presidential hopefuls are focused on so many other things?

The biggest single issue for the voters in every one of these groups, regardless of party or state, is their existing health insurance plan. Their premiums, deductibles and copayment amounts are on a relentless march upward.

I heard countless stories of surgeries from years ago that families are still trying to pay off thanks to $3,000-$5,000 deductibles.

Worse, there were stories of critical surgeries postponed because of families' inability to pay those deductibles. There were also stories where families had dropped insurance altogether and were taking their chances because insurance was unaffordable.  

Rising health-care costs would be bad in any circumstance, but the news is especially tough because a majority of Americans can’t miss a single paycheck. Most are in jobs with little prospect for meaningful advancement and often where the threat of automation is looming.  

So how will Medicare at 55 help? It will allow some people who aren’t insured to get affordable insurance. For others, it will be cheaper or better coverage than their employer now provides.

Most importantly, for employer-provided plans, Medicare at 55 will take on the highest-cost participants, and businesses will be left with younger and healthier participants and therefore better able to hold premiums and deductibles flat — if not reduce them.

But the key to getting this relief to Americans soon is that Medicare at 55 is politically feasible, especially if Democrats make gains in 2020. It will go a long way toward the ultimate goal of affordable health care for everyone, reducing sickness and disease in our great country.

It is politically feasible because it helps the average family and because hospitals and insurers will still have their roles: A 55 year-old employee of a company can stay with her current policy or choose Medicare or Medicare Advantage. It is also feasible because by age 55, most folks have been paying into Medicare for decades. 

Lastly it is feasible because it is affordable. The employer will still contribute at the same level. Medicare also has cost advantages compared to other insurers since it accounts for 30 percent of U.S. health-care spending and has by far the greatest buying power. It does a better job containing costs, so this advantage will increase over time.

One more highly important thing: For the 3.6 million people that annually enroll in regular Medicare, there are usually catch-up expenses since folks often defer procedures until they get Medicare.

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Having Medicare at 55 in place means that more people will get better care sooner and won’t need to do this catching up. 

All in all, this means that over a 10-year horizon, the cost will be manageable and low. Along with this, we must fully restore the Affordable Care Act. 

The bottom line is that if we are interested in helping folks on health-care costs soon, we’ll put forward a bill for Medicare at 55 and get it passed. 

Before the 2020 race runs full tilt, I’m calling for a Democratic contender to focus on the middle class with a program like this. It’s time to get the Democratic Party — and the majority of Americans — back on track!

Richard Vague is a managing partner of Gabriel Investments and author of "A Brief History of Doom." He is a former U.S. State Department’s Advisory Committee member on International Economic Policy.