Raising Medicare eligibility age may boost overall healthcare spending, study finds

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Raising a Medicare beneficiary's eligibility age to 67 may increase the nation's overall healthcare spending, according to a new study published Monday.

Some lawmakers have proposed increasing the eligibility age for Medicare beneficiaries in order to cut down on government spending and decrease the federal budget deficit. A 2013 report from the Congressional Budget Office found that while raising the eligibility age would result in savings for the government, the total amount is much lower than many lawmakers originally estimated — a hypothetical age boost could save the feds $19 billion between 2016 and 2023.

The new study, conducted by researchers at Harvard University and published in the May issue of Health Affairs, shows the change would mean more beneficiaries are using private insurance until they hit age 67. Those private plans tend to give higher reimbursements to providers than Medicare, meaning the overall cost of healthcare would rise.

When Medicare beneficiaries enter the program at age 65, researchers found, healthcare spending drops by $38.56 — or 32.4% — per beneficiary per quarter. The volume of healthcare services used by beneficiaries showed no change once they entered Medicare, which may be attributable to the program's large size and purchasing power, researchers said.