"Medicare at 50": Sen. Debbie Stabenow Explains Her Medicare Buy-In Plan

By Sarah Kliff, Vox

14 February 19

As momentum builds around single-payer, the Michigan Democrat pitches a more incremental approach.

ver the past year, congressional Democrats have rolled out more than half a dozen plans to expand public health insurance as they increasingly line up behind universal coverage.

Sen. Debbie Stabenow (D-MI) is now stepping into the fray with a plan that would allow Americans 50 and older to buy into the Medicare program. Her “Medicare at 50” bill is a revised version of a proposal she has authored in previous sessions of Congress; the most notable difference is the age threshold for buying in has been lowered from 55 to 50.

A Medicare buy-in would make a big difference for older Americans who can, even under Obamacare, face steep prices in the individual market. The buy-in program would likely be able to offer lower premiums because Medicare typically pays doctors and hospitals lower prices than private insurers.

When the Congressional Budget Office scored a more limited Medicare buy-in plan (one that let older Americans start buying in at 62), it estimated that the premiums for the public plan would be about $7,600 annually — significantly lower than the average $15,300 premium on the Obamacare markets that a 64-year-old currently faces. It should be noted that many seniors with lower incomes would pay significantly less than either of those amounts because they could use the Affordable Care Act’s tax credits to purchase their coverage.

Stabenow’s bill looks like a modest change when you compare it to the proposals from her Senate colleagues, who have called for letting everyone buy into Medicare regardless of their age — or, in Sen. Bernie Sanders’s (I-VT) case, getting rid of private insurance altogether and replacing it with a government-run plan. Stabenow argues that this gives her plan something of an advantage: that it might be the rare piece of health policy legislation that could get Republicans to endorse an expansion of public health benefits.

“This is something that could provide health care coverage, that could work right now,” she said in a recent interview.

Stabenow’s assessment is, admittedly, a pretty optimistic one. Republicans have shown no desire to work with Democrats to expand Medicare to more Americans, instead running attack ads criticizing the possibility of a government takeover of American medicine. In 2009, when Congress was debating the Affordable Care Act, a Medicare buy-in for older Americans couldn’t even get the backing of the full Democratic caucus.

Stabenow argues that this time around is different: that Americans have come to expect access to affordable coverage as a result of Obamacare, and that she thinks this will lead to more openness to plans like hers — which would put another affordable option into the marketplace. And it is true that polling from the Kaiser Family Foundation finds that of all the plans to expand Medicare, the idea of letting older Americans buy into the program polls most favorably with Republican voters.

I spoke with the senator about how her plan works, why she thinks it can succeed now after failing a decade ago, and what she thinks of Sanders’s Medicare-for-all plan. A transcript of our discussion follows, lightly edited for clarity and length. 

Sarah Kliff

Tell me a little bit about your Medicare buy-in proposal. How does it work, and why is now the right time to introduce it?

Debbie Stabenow

This legislation is something that I believe is very doable, and a very important next step as we look at how we can structural a universal health care system.

I remember, going back to the Affordable Care Act, I was involved with Sen. John Kerry in pushing for a Medicare buy-in that started at 55. We got very close. I wish we’d been able to get that.

What we find over and over again is that the people who are most likely to be paying higher premiums are people over 50. We have a situation where people are losing jobs, and finding it hard to find affordable health insurance. There are professions with mandatory retirement in their 50s. Some of those have good retirement insurance, and others don’t.

This, to me, is a very important group of people to focus on as we expand affordable coverage. The other thing I think is important is that this is a joint House-Senate effort. I’m introducing it with Congressman Brian Higgins [D-NY]. So far, we don’t have any Republican colleagues [on board], but I do think this is the most likely [of the plans to expand Medicare] to get support. 

Sarah Kliff

The last time you introduced Medicare buy-in legislation, the age threshold was set to 55. Now you’ve lowered it to 50 to align with the House legislation. Why’d you decided to take the age threshold down by five years?

Debbie Stabenow

In talking to folks that do the economics of health care, it became important for me to hear that this didn’t impact the cost much one way or another, depending whether you start at 50 or 55. It didn’t have an impact that was negative, so we figured we should go for as much coverage as possible. We find that there are people who are 52 or 53 who get caught up in these issues.

Sarah Kliff

It’s interesting that you say you want to go for “as much coverage as possible” because, as you know, some of your colleagues in the Senate have introduced bills that would allow everyone to enroll in Medicare regardless of their age. What do you think of those proposals?

Debbie Stabenow

First of all, I love the fact that it’s Democrats who have proposals to provide more health care for people at less cost. The big dividing line is between Republican proposals that take away health care, and ours. We all want more affordable health care. What we’re debating is, structurally, what do things look like long term, in terms of Medicare-for-all and how private insurance fits into all that. There’s a lot of debate and discussion that is ongoing.

Our proposals could have bipartisan support. This is something that could provide health care coverage, that could work right now.

Sarah Kliff

Do you have a sense yet of how much the premiums would be for people who want to buy into Medicare? Will they be lower than the current price of private health insurance on the Affordable Care Act marketplaces?

Debbie Stabenow

I think it’s very likely that it will be. We know this plan will be competitive, and it may be less expensive than the current options. It depends a bit on the tax credits and cost sharing in terms of what people qualify for. [Ed. note: Stabenow’s bill allows low- and middle-income patients who qualify for Obamacare subsidies to use those funds to buy into Medicare.] It has the potential. We know it won’t be more, and we know Medicare provides comprehensive coverage. So we know it will be good-quality and, for many people, cost less.

Sarah Kliff

What do you think would be the labor market effects of a bill like yours? Do you think we’ll see more older Americans leaving their jobs and buying into Medicare?

Debbie Stabenow

It will be a choice, and a way to see how the marketplace works. People who have a private policy who feel this works for them may not be drawn to this. But I’ve had so many people who have said to me, “I’m holding my breath until I turn 65 and get on Medicare.” This is a great solution for those people.

Sarah Kliff

Do you think we’d see more Americans retiring early if a bill like yours was enacted?

Debbie Stabenow

I think, again, people want to have the assurance that they have health care when they need it in their 50s. I don’t think that means someone chooses not to work; I don’t see that as driving the decision. When you don’t have to work at a job for health care, when you have more affordable options, you can start your own business. This gives that affordable option, and that peace of mind knowing there are affordable, comprehensive options available.

Sarah Kliff

I know you were serving in the Senate during the Affordable Care Act debate, and remember that this type of Medicare buy-in just couldn’t get enough support to become part of the law. Some members of the Democratic caucus wouldn’t support it. Do you think things will be different this time around?

Debbie Stabenow

I think one of the fundamental things that has changed in our country is that, with the Affordable Care Act, people now have access to affordable coverage and expectations have changed. We have essential benefits. We’ve changed the decision-making so it’s not the insurance company deciding whether you get five cancer treatments or five weeks of cancer treatments. It’s you and your doctor.

Access to affordable health care is viewed as a basic right now. People don’t want to go back to a time when that wasn’t the case.

Sarah Kliff

The last thing I wanted to discuss was Sen. Sanders’s health care bill, which would create a Medicare-for-all system. His bill wouldn’t give people the option to choose between private or public coverage; it would move everyone onto a government program. What do you think about that policy idea?

Debbie Stabenow

I certainly embrace the goal of universal health care coverage. To me, it’s a question of how that’s designed. Even with Medicare right now, private insurance participates as Medicare Advantage.

I think there are a number of questions about how it’s designed, but I certainly support the goal and the passion behind the desire to make sure everyone has health care.

Sarah Kliff

I know you’re not currently a co-sponsor of the Sanders bill. Is it a proposal you could ever see yourself supporting?

Debbie Stabenow

Right now, I have a lot of questions about how it would work.

Sarah Kliff

What kind of questions?

Debbie Stabenow

We have people who have negotiated good health insurance, often through their unions. So I have a lot of questions about how that transition would happen, what it means for people. It’s just a lot of different questions about how all that would happen.