(Bloomberg Opinion) -- As the cost of President Joe Biden’s spending package shrinks from $3.5 trillion closer to $2 trillion, Senator Bernie Sanders’s proposal to add dental, vision and hearing coverage to Medicare has emerged as a sticking point in negotiations. Opposing Sanders are Democrats such as Congressman Jim Clyburn of South Carolina who would like to prioritize spending to benefit low-income people — including by providing health insurance for the poor in states that have refused to expand Medicaid.
There is a way to compromise — to add new benefits to Medicare without spending so much that there’s no room in the budget for helping the Medicaid-deprived.
Rather than simply offer dental, vision and hearing benefits to all Medicare beneficiaries, create an optional, buy-in policy. This would enable seniors to take advantage of the federal government’s purchasing power but still limit the cost to taxpayers. It would keep Medicare solvent longer. And it would provide standardized plans for beneficiaries — rather than the patchwork of coverage now available to those who sign up for Medicare Advantage or supplemental Medicare plans.
Older Americans clearly need affordable dental, vision and hearing coverage. The only question is how best to pay for it. A buy-in program could be structured like the Affordable Care Act and the Medicare Part D prescription drug benefit, both of which give subsidies to people below a certain income threshold.
As things stand, many people are simply going without dental, hearing and vision care. In a 2018 survey of Medicare beneficiaries, asking about their behavior over the course of a year, the Commonwealth Fund found that 70% of those who had dental problems did not visit a dentist, 43% of those with vision problems did not have an eye exam, and 75% of those who needed hearing aids did not have them. What’s more, those who did have coverage — via a supplemental policy or Medicare Advantage — had to pay a large share of the cost themselves. The Kaiser Family Foundation found they spent an average of $874 on dental care, $230 on vision care and $914 on hearing services.
Almost half of Medicare beneficiaries have no dental coverage, and even those who do have it forego routine preventive care because of the high out-of-pocket costs. This can exacerbate their chronic health conditions and cause preventable complications that lead them to the emergency room.
Vision care is more affordable. The Commonwealth analysis of Medicare survey data found that beneficiaries spent on average $715 on vision services in a year, 60% of that out of pocket. This cost is lower than for dental care because Medicare covers some vision-related conditions: Part B (which insures services outside of hospitals) pays for an annual eye exam to screen for diabetic retinopathy, glaucoma and macular degeneration. The program does not, however, cover routine vision exams, eyeglasses or contact lenses.
As for hearing care, mid-tier hearing aids cost about $4,500, though they can run as high as $7,000. There is an ongoing push to increase competition by making them available over the counter, including via an executive order from Biden. But this has yet to be approved by the Food and Drug Administration.
The Commonwealth Fund estimated that a modest buy-in policy to cover dental, vision and hearing services — with a $150 deductible, 20% coinsurance (the beneficiaries’ share of costs) and a $1,500 annual benefit limit — could be offered for about $25 a month. This is assuming that at least 70% of eligible, not-already-insured Medicare beneficiaries would buy in. Premiums and cost-sharing could be subsidized for people with incomes up to 150% of the poverty level.
Such a program would raise nearly $2 billion a year in premiums, and it would cover some 6.4 million Medicare beneficiaries above 150% of the poverty level. The cost to subsidize about 2.4 million people below that income threshold would be a little more than $1 billion a year. That’s much less than the $80 billion a year that the Congressional Budget Office has said Congress’s current proposal would cost. A voluntary program would also avoid disrupting the current Medicare Advantage formula, and instead encourage Advantage plans to offer more competitive dental, vision and hearing benefits of their own.
By creating an optional buy-in policy like this, Democrats could give Medicare beneficiaries better access to dental, vision and hearing services — and leave room in the budget to provide Medicaid coverage for poor people in the states that have refused to expand that program. They could protect low-income seniors, standardize benefits for everyone and protect the most vulnerable Americans.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Arielle Kane is the director of health care at the Progressive Policy Institute in Washington.
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