Medicare—the nation’s health insurance program for more than 60 million people ages 65 and older and younger adults with permanent disabilities—is often an election issue, particularly among older voters. Historically, Medicare and Social Security have been election issues because older voters understand that these programs are essential to their health and economic security in retirement, and candidates understand that older people are more likely than younger adults to vote.
But this year is shaping up to be no ordinary election year. Older adults, like younger adults, are intensely focused on the consequences of COVID-19. People ages 65 and older have been at the epicenter of this pandemic when it comes to serious illness, hospitalizations and deaths, accounting for 80 percent of all COVID-19 deaths. Long-term care facilities have been especially hard hit, accounting for more than 40 percent of all COVID-related deaths.
As the number of deaths continues to climb, and as the nation heads into what could be a sustained recession, people of all ages may be more acutely worried about their family’s health and ability to make ends meet than they are about more typical election issues. And this year, the election may turn more on leadership and character than on any particular policy issue.
While the pandemic tops the list of health issues for voters, candidates are also talking about Medicare and related issues, including prescription drug prices and health care costs, knowing that Medicare is popular among older voters, that older people value their health coverage and have concerns about their medical expenses.
Prescription Drug Prices: Unfinished Business
President Trump and former Vice President Biden both talk about lowering drug prices, but an important difference between them is whether they support a change in law that would give the Department of Health and Human Services Secretary authority to negotiate drug prices—a change that is fiercely opposed by the drug industry but has broad support among the public. Prior to the 2016 election, candidate Trump was an advocate for this approach, but he has not endorsed it while in office.
Biden is proposing to give the Secretary authority to negotiate drug prices for Medicare and private purchasers, along the lines of the bill that passed the U.S. House of Representatives in late 2019, and again in 2020. This approach, according to Congressional Budget Office, would provide more than $500 billion in savings on prescriptions for Medicare and private insurance. Biden and Trump are both for allowing the safe importation of drugs and for capping out-of-pocket drug spending for Medicare drug plan enrollees.
President Trump recently issued four executive orders that aim to lower drug prices, including his most recent “most favored nation” proposal to limit how much Medicare pays for certain drugs, based on how much other countries pay. None of these four executive orders appear on track to be implemented before the election.
Candidates campaigned on the issue of lowering drug prices in 2016 and again in 2018, and at one point, it looked as if the House, the Senate and the Trump Administration could have come together on a deal to deliver on campaign promises, but the prospects for action in the next few months are rapidly fading, putting this issue back on the policy agenda after the election.
Health Care Affordability: A Big Concern
Health care costs are a pressing concern for the public, including older adults with Medicare. Health-related expenses amount to 41 percent of per capita Social Security income across all Medicare beneficiaries. Traditional Medicare has high deductibles, requires cost-sharing for most services and has no limit on out-of-pocket spending (unlike employer and marketplace coverage).
Medicare does not generally pay for dental, vision or hearing services, or the exceedingly high and often unaffordable cost of extended long-term care in a nursing home, assisted living facility or at home. Biden proposes to help fill the gaps in Medicare coverage in a financially sustainable manner. President Trump has not endorsed these benefit enhancements, but his Administration has broadened Medicare coverage to pay for COVID-19 tests, a vaccine (once approved) and telehealth services during the pandemic.
The pros and cons of Medicare-for-all—including its impact on older adults and Medicare itself—could resurface before the November election.
Until recently, Medicare’s coverage of telehealth services was quite limited. The Trump Administration used its emergency authority to broaden coverage, making it easier for older adults to have virtual visits with their doctors and other health professionals, while avoiding a trip to a medical office that could increase their risk of infection and serious illness. Since then, telehealth services have taken off, and have proven to be popular with patients and health care professionals. A key question moving forward is whether this will become a permanent Medicare benefit, and at what cost.
With half of all older adults living on yearly incomes of $29,650 per person or less, the cost of uncovered services is often unaffordable. The lack of financial resources is an even greater concern among older adults in communities of color. Candidates are likely to talk about ways to make health care more affordable for people on Medicare, and their families.
What Happened to Medicare-For-All?
Medicare-for-all erupted as the subject of intense debate during the Democratic primary, but the presumptive Democratic nominee, Joe Biden, does not support this approach. Instead, Biden proposes to build on the Affordable Care Act (ACA), by extending and enhancing subsidies and offering a new, federal public option, modeled on Medicare, in the marketplace. He would also lower the age of Medicare eligibility to 60, financed separately from the current Medicare program to protect the Medicare Trust Fund.
President Trump opposes Medicare-for-all and other proposals that would broaden Medicare eligibility, and has supported numerous efforts to repeal and replace the ACA, without articulating a clear path forward to retain or broaden coverage. The Trump Administration is currently supporting a case before the Supreme Court that would overturn the ACA that is scheduled for oral argument soon after the election.
Trump may try to paint the Biden approach as being more similar to the Medicare-for-all proposal than it is. In reality, the Biden proposal differs in a number of ways; for example, it retains employment-based coverage, and keeps both the Medicare and Medicaid programs intact. Even though Biden does not support it, the pros and cons of Medicare-for-all—including its impact on older adults and Medicare itself—could be revisited and debated in the months leading up to the November election.
Tough Financing Decisions Ahead
What voters may not hear before November is a serious discussion about how best to tackle some of the more politically difficult decisions that lie ahead for Medicare, including how to finance care for an aging population or how Medicare, which accounts for 15 percent of the federal budget, will fit into larger efforts to reduce the federal deficit and national debt.
Whoever wins the election will soon face tough decisions about how to bolster the Medicare Hospital Insurance Trust Fund, potentially involving policies to reduce spending, increase revenues or cut benefits. According to the latest numbers, the Medicare Trust Fund is projected to be insolvent in 2024, just four years from now. The financial outlook for the Medicare Trust Fund has been deteriorating over the past few years, because of changes in law that reduced revenues, such as the 2017 tax cut legislation, and this year, the economic fallout of the COVID-19 recession.
With the nation reeling from the health and economic consequences of COVID-19, older voters may be less focused on Medicare this November than in prior years. Whether voters are focused or not, the outcome of this election is likely to have a profound impact on the future of Medicare.
Tricia Neuman is senior vice president of the Kaiser Family Foundation and executive director of its Program on Medicare Policy, in Washington, DC.