So far in the 2016 presidential campaign, Medicare and retiree health plans haven’t been near the top of the burning issues’ list. But these important programs still deserve your careful attention when making your choice this fall.
Medical insurance is a critical part of any retirement plan. Most retirees age 65 and older are covered by Medicare, and many buy Medigap or Medicare Advantage plans to cover what Medicare doesn’t. Retirees under age 65 must usually purchase insurance on their own or, if they’re lucky, be covered by a former employer’s health care plan.
As a result, over the next several years, your options will be significantly influenced by the next president’s intentions for Medicare benefits and its financing, as well as health care plans for retirees under age 65.
Let’s look at the positions Hillary Clinton and Donald Trump have staked out, in alphabetical order.
Clinton’s website prominently states that affordable health care is a basic human right, and she supports “universal, quality, affordable health care for everyone in America.” More specifically, her website says that as president, she will:
- Support the Affordable Care Act (ACA), which allows anybody to purchase health insurance without being subject to exclusions for preexisting conditions. Prior to the ACA’s enactment, many retirees under age 65 were unable to purchase health care at any cost due to such exclusions.
- Not reduce Medicare eligibility and, in fact, would allow retirees age 55 and over to buy into Medicare.
- Reduce the cost of prescription drugs by negotiating Medicare reimbursements with drug companies. In addition, she would “require pharmaceutical companies to provide higher rebates in the Medicare low-income subsidy program, ensuring that rebates are at Medicaid levels. This would save more than $100 billion in Medicare costs.”
- Provide incentives to states for expanding Medicaid coverage, which will help low-income retirees obtain coverage before age 65.
- Double the funding for primary-care services at community health centers over the next decade. She also “supports President Obama’s call for a near tripling of the size of the National Health Service Corps.”
Clinton’s website contains a fact sheet that expands on her commitment to enhance health care and addresses a number of significant health care challenges. It also includes a separate fact sheet on her proposals to manage prescription drug costs.
Trump’s website contains no positions that are specific to Medicare, but it lays out the following positions on health care in general. As president, Trump would:
- Immediately repeal the ACA. “Our elected representatives must eliminate the individual mandate. No person should be required to buy insurance unless he or she wants to.”
- “Modify existing law that inhibits the sale of health insurance across state lines. ... By allowing full competition in this market, insurance costs will go down and consumer satisfaction will go up.”
- “Allow individuals to fully deduct health insurance premium payments from their tax returns under the current tax system ... As we allow the free market to provide insurance coverage opportunities to companies and individuals, we must also make sure that no one slips through the cracks simply because they cannot afford insurance. We must review basic options for Medicaid and work with states to ensure that those who want healthcare coverage can have it.”
- “Allow individuals to use Health Savings Accounts (HSAs). Contributions into HSAs should be tax-free and should be allowed to accumulate.” Note: HSAs are already tax-free and are allowed to accumulate. Under current law, HSAs are available only to individuals with high-deductible plans.
- “Require price transparency from all healthcare providers, especially doctors and healthcare organizations like clinics and hospitals.”
- “Block-grant Medicaid to the states. Nearly every state already offers benefits beyond what is required in the current Medicaid structure.”
- “Remove barriers to entry into free markets for drug providers that offer safe, reliable and cheaper products. ... Allowing consumers access to imported, safe and dependable drugs from overseas will bring more options to consumers.”
Trump’s website goes on to state that enforcing immigration laws will reduce health care costs for illegal immigrants and that his economic proposals will boost the economy, provide jobs and, in the process, increase access to health care.
If the ACA is repealed, it’s not clear how Trump’s proposals would help retirees under age 65 obtain health care coverage, although his website implies that Medicaid should be available to those who want such coverage. It’s also unclear how individuals would be treated if they decline to buy insurance coverage, then get sick with an expensive illness and want to purchase coverage.
Allowing individuals to purchase health insurance only when they need it will cause health care costs to spiral out of control.
In the primary, Trump went on record to oppose cuts to Medicare, which conflicts with the Republicans’ official platform position that would transition Medicare to a premium-supported system for citizens under age 55 and would increase Medicare’s eligibility age to reflect longer life spans.
It will be interesting to see if Clinton’s and Trump’s positions on Medicare and retiree health care receive any significant attention during this contentious campaign, and if they provide any further details on their positions.
You’ll also want to consider each one’s skill and ability to negotiate feasible solutions with Congress for a health care system that’s so complex and then sell these solutions to the public.
And of course, you’ll want to weigh the importance of their positions on Medicare and retiree health against their positions on other issues.
It’s a good use of your time to understand the candidates’ views on Medicare and Social Security. Voting responsibly on these issues is part of your retirement plan.