Many Americans who pay taxes throughout their careers expect to receive comprehensive health care when they reach eligibility. In reality, Medicare coverage doesn’t include everything. Still, politicians have their eye on Medicare expansion to close the gap between the federal program’s current offerings and the complete coverage seniors want and need.
In the content below, we’ll explain what it means when you hear about Medicare expansion. We’ll also answer your questions about potential funding and timelines for these proposals.
What is Medicare Expansion?
Medicare expansion refers to broadening the benefits of the program, as the parts in which beneficiaries enroll through the government provide limited coverage. Throughout the years, extensions of the program have been uncommon, with one of the most notable instances being coverage of disabled individuals under 65.
Original Medicare consists of hospital insurance (Part A) and outpatient insurance, including preventive care (Part B). These parts don’t pay for dental, vision, or hearing services – nor do they include prescription drugs that beneficiaries take at home.
To obtain these benefits, someone on Medicare would also need to purchase a Medicare Part D prescription drug plan, along with an ancillary policy for dental, vision, and hearing. Or, they could go with one of the best Medicare Advantage plans in their area for these benefits wrapped into one policy.
Additionally, Medigap plans are another type of supplemental insurance. These plans cover the coinsurance costs that come with Original Medicare.
Supplemental policies through private insurance companies, along with Medicaid for those eligible, help keep expansion on the backburner. Yet, the coverage gaps go beyond what the aforementioned policies include.
Chiefly, Medicare doesn’t include long-term custodial care. Numerous Americans require these daily services late in life, and the costs can quickly add up – even when they have additional policies.
Medicare vs. Medicaid Expansion
While many states have expanded their Medicaid programs, the process for doing the same with Medicare would be very different. Medicaid is government health insurance for those with low incomes, which the federal and state governments collectively manage.
On the other hand, the federal government solely runs Medicare, so expansion would need to happen nationwide. Therefore, there must be majority support for the expansion of Medicare, and the bill must pass for it to be possible.
The Democratic Senate’s Proposal
Since his election campaign, President Biden has talked of lowering the Medicare age to 60. Now, Senate Democrats are furthering his agenda, proposing expansion for Original Medicare to include hearing benefits in addition to a non-specific, reduced eligibility age.
The proposal for the upcoming fiscal year will be in the works this fall. These expansions are part of a larger budget reconciliation bill that involves a $1.75 trillion budget and banks on future economic growth.
The Medicare expansions are one item on a list of proposed policies in areas including health care, climate, and education.
Who Pays for Medicare Expansion?
Medicare primarily receives funding through payroll taxes. Thus, more tax revenue will be necessary for an expansion to be possible.
Most recently, the bill’s starting budget of $3.5 trillion was halved. Thus, dental and vision benefits are no longer up for expansion this time, leaving only coverage for hearing care. Still, the addition of hearing benefits to Original Medicare would be a significant change for the program.
The funding for the expansion would come from a tax increase for high-income individuals and tax reform concerning corporate and international entities. Additionally, the Democratic Senate proposes an offset will occur through IRS tax enforcement.
Will Medicare Be Expanded?
While long-term custodial care and other crucial services for seniors are not yet options on the table, reducing the need for ancillary policies to help pay for hearing aids would be a start. Yet, it is not a guarantee that the bill as a whole will make it through Congress.
In the meantime, beneficiaries need to stay informed about any changes that will affect their coverage. This content will reflect updates as more information becomes available.
If you’re looking to explore options for supplemental Medicare coverage, call the phone number above or fill out our online rates form.