Chart Review - The RAND Corporation report assessing the potential impact of a Medicare buy-in.

Andrew Strohman, Health Care Data Analyst

The RAND Corporation recently published a report assessing the potential impact of a Medicare buy-in. While its results on enrollment are similar to those reported in AAF’s model of H.R. 1346, which would also allow those aged 50-64 to enroll in Medicare, there are some differences in its projected premiums. AAF’s projected 2022 average buy-in premium is $10,900, significantly higher than the $9,747 premium projected for both 50- and 60-year-old buy-in enrollees under RAND’s projection for the same year. Additionally, AAF projects the buy-in premium will be higher than both the average Bronze and Gold plans, while RAND expects buy-in premiums to be lower than at least the Gold plan.

These disparities may come from subtle differences in assumptions for the modeling. While both assumed actuarial values (AV) of 80 percent (equivalent to a Gold plan) and roughly the same national average ratio of payment rates (between 84-86 percent), RAND assumed that those who qualified for cost-sharing reduction (CSR) payments would receive plans with AVs of 94, 87, and 73 percent as household income approached 250 percent of the federal poverty level (FPL). AAF specifically modelled H.R. 1346, using its proposed expanded CSR eligibility with AVs of 95, 90, and 85 percent up to 400 percent of the FPL. Furthermore, AAF assumed the reintroduction of an individual mandate penalty while RAND kept it zeroed out. Finally, RAND seems to model the average premiums offered while AAF models premiums paid. These alternative assumptions may explain the different final premiums.

Data obtained from RAND and AAF

https://www.americanactionforum.org/weekly-checkup/a-surprisingly-busy-week-in-health-policy/#ixzz69cXjHe1f
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