AARP, business group offer competing views of Medicare reform

The eligibility age for Medicare should be raised from 65 to 70 years, and the program should include private plans competing with the current fee-for-service model, the Business Roundtable proposed Wednesday.

The proposal from the CEO group comes as long-term care providers consider options for continued fiscal stability. In addition to changes to Medicare and Medicaid under the Affordable Care Act, deficit hawks have their eye on entitlement programs. Any disruption in payments from these programs could hurt nursing homes, which in 2013 will get 55% of their revenue from these sources, according to federal estimates cited by Bloomberg.

The Business Roundtable argues raising the eligibility age and allowing competition would let Medicare cut costs and would likely improve benefits. However, organizations such as the American Association of Retired Persons (AARP) have disagreed.

In a speech at the National Press Club on Monday, AARP CEO A. Barry Rand reiterated his group's opposition to raising the Medicare eligibility age. He said doing so would simply shift costs. Medicare premiums are based on average costs, and younger beneficiaries are less costly than older enrollees, so premiums would rise if the younger group were cut from the program, he said.

Rand argued that innovations such as improved integrated care are a wiser path toward reform.