From the earliest days of the pandemic, COVID-19’s disproportionate impact on the health of people age 65 and older—in rates of infection, hospitalization,
and death—has been painfully apparent. Yet the pandemic’s impact on the financial well-being of older people—in terms of employment, income, and health
insurance coverage—has received little, if any, attention. To fill that gap, this issue brief describes the demographics of older workers and assesses their
pandemic-related loss of employment, income, and employer-sponsored health insurance coverage. It also considers the potential effect of these losses on federal spending
In 2018, prior to the pandemic, more than one in six Medicare beneficiaries, or 10.1 million people, were employed, including 9.0 million beneficiaries age 65 and
older and 1.1 million under age 65. During the pandemic, about 11 percent of people 65 and older, or about 1.1 million people, have lost their jobs. These job losses
could result in many older workers shifting from employer-sponsored health insurance to Medicare, increasing federal spending for Medicare.
The job losses and income reductions among Medicare beneficiaries also could threaten their financial security, resulting in more beneficiaries qualifying for Part D
low-income subsidies, Medicare Savings Programs, or even Medicaid. During this time, Medicare will serve as an important safety net, but policies to encourage the
continued employment of older workers could have long-term effects on Medicare spending and people’s financial security for the remainder of their years.
Compared with younger adults, older workers face greater health risks from COVID-19, especially if they are unable to work remotely. Jobs that allow older workers to
work from home will prevent them from having to choose between their health and their income. With regard to health insurance coverage, many working older Americans
could lose their employer-sponsored coverage if they lose their jobs, requiring them to receive full benefits from Medicare. This shift should further motivate
policymakers to address limitations to Medicare’s benefits, which already burden beneficiaries with low and modest incomes.
You can find the full Commonwealth Fund study here.