Regular readers of Eakinomics are aware that the federal debt has breached the $40 trillion threshold. And the attention that surrounded that event brought home to the general public the fact that Uncle Sam is far from flush; in fact, for all practical purposes he’s walking around in his skivvies. This is why The Washington Post recently opined that the U.S. can’t afford to fully defend itself:

The federal budget is not prepared for such contingencies. Judging by the size of the deficit alone, one might assume the U.S. is already fighting a war far more involved than the on-again, off-again bombing of Iran. The additional burden of borrowing to finance a full-scale, protracted conflict could push the budget into more dangerous territory than it’s already in.

But some politicians have not internalized the reality. The paper also reported that Democrats are actively considering major expansions of federal health spending:

… the discussions also include other more novel and divisive policies like lowering the age for Medicare eligibility from 65 years; expanding Medicare coverage to dental, vision and hearing aid benefits; and adding other government-run insurance options, according to the people. These details have not been previously reported.

These discussions carefully steered away from the toxic fantasyland of Medicare for All (M4A). But notice they explicitly include lowering the Medicare eligibility age. Eakinomics thinks of these proposals as Medicare for More (M4M). Is M4M a viable substitute for M4A? To find out, Stephen Parente of AAF’s Center for Health and the Economy analyzed the implications of dropping the Medicare eligibility age to 62, thereby matching the early retirement age in Social Security.

In doing the analysis, a key consideration is how employers would respond to having Medicare available to their workers aged 62-64. Would they continue to be offered employer-sponsored insurance? If so:

Lowering the Medicare eligibility age to 62 would cost $387.6 billion over the 10-year period from 2027–2036 after accounting for savings that would accrue to the Affordable Care Act’s (ACA) marketplace from lower spending on subsidies and assuming employers continue to offer health insurance to those newly eligible for Medicare.

Now, $400 billion is like starting the Medicare Part D drug program over again — not exactly chump change. And that’s the good news, because it is really unlikely that zero employers will scale back their health insurance coverage. To get a feel for the upper bound, suppose that all the employers dropped their coverage of 62-64 year-olds: “the total cost of the policy would climb to as high as $1,771.1 billion (about $1.8 trillion).”

It’s not going to happen because it can’t. The expand-coverage-at-all-costs era is over. The new era is to focus on the efficiency of federal programs and a delivery system with better outcomes and lower costs. It’s Better Medicare for Medicare Beneficiaries (BM4MB).