FY 2008 HHS Budget Item

In 1972, Congress expanded Medicare eligibility to persons with end stage renal (kidney) disease, regardless of age. At the time, the plan was to gradually expand Medicare to other catastrophic illnesses. However, this expansion wound up being much more expensive than Congress anticipated because business follows money.

Congress later mandated that employer sponsored health plans, including FEHB plans, provide their benefits before Medicare for a certain time period. The current time period is 30 months (ncreased from 18 months ten years ago). Business Insurance reports that the President’s FY 2008 budget proposes (for the second year running) that such period be increased to 60 months or 5 years. The budget estimates that this change would save Medicare $1 billion. As the GEICO gecko might say, “Easy Money.”