Income and Assets of Medicare Beneficiaries in 2023

Greater than sixty-five million folks ages 65 and older and more youthful folks with long-term disabilities obtain their medical health insurance protection throughout the federal Medicare program. Whilst overall satisfaction with the program is high, the monetary burden of well being care spending can end up difficult for Medicare beneficiaries. In keeping with a recent KFF survey, greater than one-third (36%) of Medicare beneficiaries mentioned they’ve behind schedule or long gone with out a consult with to the physician’s place of work, imaginative and prescient products and services, listening to products and services, prescribed drugs or dental care throughout the ultimate 12 months on account of the fee. Medicare families additionally spend a larger share of their total budgets on health care than non-Medicare families, and are much more likely to want expensive long-term services and supports over a longer time frame that are not covered by Medicare.

This temporary examines the source of revenue, belongings, and residential fairness of Medicare beneficiaries, total and by means of age, race and ethnicity, and gender, the use of information derived from the Dynamic Simulation of Source of revenue Fashion (DYNASIM) for 2023. Because of information barriers, estimates for beneficiaries in some racial and ethnic teams, together with Asian, American Indian and Alaska Local, and Local Hawaiian or Different Pacific Islander beneficiaries, in addition to beneficiaries who establish as two or extra races, are unavailable (see Methods for added main points at the style).

This research highlights that the majority Medicare beneficiaries survive somewhat low earning and feature modest monetary sources to attract upon in retirement in the event that they want to quilt expensive hospital therapy or long-term products and services and helps, with notable disparities by means of age, race and ethnicity, and gender. For instance:

• One in 4 Medicare beneficiaries lived on earning under $21,000 according to particular person in 2023, whilst part lived on earning under $36,000 according to particular person. Median source of revenue declined with age amongst older adults, was once decrease for girls than males, and decrease for Black and Hispanic than White beneficiaries.
• One in 4 Medicare beneficiaries had financial savings under $16,950 according to particular person in 2023, whilst part had financial savings under $103,800 according to particular person. As with source of revenue, median financial savings declined with age amongst the ones ages 65 and older, have been decrease for girls than males, and have been considerably decrease for Black ($22,100) and Hispanic ($20,050) than White ($158,950) beneficiaries.
• One in 4 Medicare beneficiaries had no house fairness in any respect in 2023, whilst part of all Medicare beneficiaries had house fairness under $124,450 according to particular person.
• Multiple in 5 Black and Hispanic beneficiaries had no financial savings or have been in debt, in comparison to fewer than one in ten White beneficiaries. Just about part of all Black and Hispanic beneficiaries had no house fairness, in comparison to one in 5 White beneficiaries.

Source of revenue amongst Medicare Beneficiaries

In 2023, part of all Medicare beneficiaries (32.6 million) had earning under $36,000 according to particular person, whilst one quarter (16.3 million) lived on earning under $21,000 according to particular person. On the upper finish of the source of revenue distribution, the highest 5 % of Medicare beneficiaries (3.3 million) had earning above $138,500 according to particular person, together with the highest one % (0.7 million) whose earning exceeded $259,150 according to particular person (Determine 1).

In keeping with particular person estimates of source of revenue numerous by means of age, race and ethnicity, and gender, even though just about all beneficiaries throughout teams had no less than some according to capita source of revenue in 2023, largely because of Social Safety (Determine 2, Appendix Desk 1).

Age: Amongst Medicare beneficiaries ages 65 and older, median according to capita source of revenue declined with age, from $39,850 amongst the ones ages 65-74 to $28,650 amongst the ones ages 85 and older, a trend which displays, partially, a discount in source of revenue from income amongst beneficiaries in older age teams and the decrease chance of getting source of revenue from income at older ages (for instance, 46% of beneficiaries ages 65-74 had source of revenue from income in 2023, in comparison to 19% of the ones ages 75-84).

In 2023, more or less one in ten Medicare beneficiaries (11%) was once below the age of 65. More youthful beneficiaries, who’re eligible for Medicare because of having a long-term incapacity, had the bottom median according to capita source of revenue of any age staff ($23,900 vs. $37,800 amongst seniors) and one in 4 lived on earning under $15,000 according to particular person (vs. $22,050 amongst seniors) (Determine 2).

Race/Ethnicity: Median according to capita source of revenue was once upper amongst White Medicare beneficiaries ($40,750) than amongst Black ($27,250) or Hispanic ($19,800) beneficiaries, reflecting wider racial and ethnic disparities in task alternatives and income throughout their running years, decrease get right of entry to to pension and different retirement advantages, and less years of schooling (Determine 2). Beneficiaries of colour also are more likely than White beneficiaries to be below the age of 65 with long-term disabilities, to document being in truthful or deficient well being, and to have a number of barriers in actions of day-to-day residing, impacting each their income throughout their running years and their skill to stay within the personnel as they age.

On the decrease finish of the source of revenue distribution, one quarter of Black beneficiaries lived on earning lower than $16,150 according to particular person, and one quarter of Hispanic beneficiaries lived on earning lower than $11,850 according to particular person, in comparison to $24,400 according to particular person amongst White beneficiaries, which positioned those Black and Hispanic beneficiaries close to or under the federal poverty threshold of $14,580 for a unmarried particular person in 2023 (Determine 2).

Intercourse: Median according to capita source of revenue was once decrease amongst ladies than males ($33,750 vs. $38,950, Determine 2). On reasonable, ladies have lower wages than males throughout their running years, even if running in an identical roles, and frequently tackle a bigger proportion of unpaid circle of relatives caregiving, leading to decrease lifetime income and lower Social Security benefits after they retire. Those gender variations endured throughout age teams amongst the ones age 65 or older, and throughout other racial and ethnic teams (Appendix Desk 2).

Marital Standing: Married beneficiaries had upper median according to capita source of revenue ($42,000) than beneficiaries who have been widowed ($32,950), divorced ($32,900), or unmarried ($21,600) (Appendix Desk 1). Spouses (or ex-spouses for marriages longer than ten years) can decide to obtain part in their partner’s Social Safety get advantages in lieu of the ease in keeping with their very own income, which would possibly be offering larger flexibility to beneficiaries who’re or were married.

Schooling: Median according to capita source of revenue rose with instructional attainment and was once greater than thrice upper amongst beneficiaries with a faculty stage ($62,150) than amongst beneficiaries with lower than a highschool schooling ($17,750, Appendix Desk 1). One in 3 White beneficiaries held a college degree or higher in 2018 (32%) in comparison to 12% and 13% of Black and Hispanic beneficiaries, respectively, suggesting a courting between racial and ethnic disparities in according to capita source of revenue and years of schooling.

Financial savings amongst Medicare Beneficiaries

Part of all Medicare beneficiaries had financial savings under $103,800 according to particular person in 2023, whilst one quarter had financial savings under $16,950 according to particular person. One in ten (10%) had no financial savings or have been in debt. A number of the wealthiest Medicare beneficiaries, the highest 5 % had financial savings exceeding $1.6 million according to particular person, together with the highest one % whose financial savings exceeded $4.3 million according to particular person (Determine 3).

In keeping with particular person estimates of financial savings, in addition to the proportion of beneficiaries with out financial savings or with debt, numerous by means of age, race and ethnicity, and gender (Determine 4, Appendix Desk 1).

Age: As with source of revenue, median according to capita financial savings declined with age amongst Medicare beneficiaries ages 65 and older, from $145,550 amongst the ones ages 65-74 to $44,250 amongst the ones ages 85 and older. By the use of comparability, the median annual cost of care nationwide in 2021 was once $108,405 for a personal room in a nursing house, and $54,000 for an assisted residing facility. Median according to capita financial savings have been lowest amongst beneficiaries with disabilities below the age of 65, part of whom had financial savings under $33,850 according to particular person (vs. $119,350 amongst seniors) and one quarter of whom had financial savings under $4,650 according to particular person (vs. $20,500 amongst seniors) (Determine 4). Kind of 15% of beneficiaries below age 65 (vs. 10% of seniors) had no financial savings or have been in debt.

Race/Ethnicity: Median according to capita financial savings amongst White beneficiaries ($158,950) have been greater than seven instances upper than amongst Black beneficiaries ($22,100) and greater than 8 instances upper than amongst Hispanic beneficiaries ($20,050) (Determine 4). On the backside quartile of the financial savings distribution, reasonable according to capita financial savings amongst White beneficiaries ($34,450) have been greater than fifty instances upper than amongst Black ($650) or Hispanic ($700) beneficiaries. Multiple in 5 Black and Hispanic beneficiaries (22% and 21%, respectively) had no financial savings or have been in debt, in comparison to simply 7% of White beneficiaries. Racial and ethnic disparities in according to capita financial savings are in most cases greater than disparities in source of revenue, and persist even amongst beneficiaries with similar levels of education, suggesting wider inequities in monetary safety and intergenerational wealth.

Intercourse: Median according to capita financial savings have been decrease amongst ladies than males ($90,850 vs. $120,450) (Determine 4), and a bigger proportion of ladies than males had no financial savings or have been in debt (11% vs. 9%). Reasonable lifestyles expectancy at age 65 is somewhat longer for women than men, and the ones with extra modest wealth accumulation could also be at larger possibility of operating out of retirement financial savings as they age. As with source of revenue, gender variations in financial savings endured throughout beneficiaries in older age teams and by means of race and ethnicity (Appendix Desk 2).

Marital Standing: Married beneficiaries had median according to capita financial savings ($169,200) that have been greater than two times as excessive as amongst beneficiaries who have been widowed ($75,350) or divorced ($65,200) and greater than six instances upper than amongst beneficiaries who have been unmarried ($27,150, Appendix Desk 1).

Schooling: Beneficiaries with a faculty stage had median according to capita financial savings ($337,500) that have been just about six instances upper than beneficiaries with just a highschool stage ($60,800) and greater than 34 instances upper than beneficiaries with lower than a highschool schooling ($9,900, Appendix Desk 1).

House Fairness amongst Medicare Beneficiaries

Part of all Medicare beneficiaries had lower than $124,450 according to particular person in house fairness in 2023, whilst multiple quarter (26%) had no house fairness in any respect (Determine 5). On the upper finish of the distribution, the highest 5 % of Medicare beneficiaries had greater than $846,900 according to particular person in house fairness, together with the highest one % who had greater than $1.4 million according to particular person.

In keeping with particular person estimates of house fairness, in addition to charges of homeownership, numerous by means of age, race and ethnicity, and gender (Determine 6, Appendix Desk 1).

Age: Median according to capita house fairness rose with age, from $132,550 amongst the ones ages 65-74 to $174,500 amongst the ones ages 85 and older, most probably reflecting the bigger proportion of house owners who had diminished or paid off loan debt in older age teams. Not like different monetary belongings, which would possibly lower as seniors go away the personnel and spend their gathered financial savings, properties generally retailer and collect fairness over the years. Median according to capita house fairness was once lowest amongst beneficiaries below the age of 65 ($14,050 vs. $142,200 amongst seniors), and one in two (48%) had no house fairness in any respect (vs. 23% of seniors) (Determine 6).

Race/Ethnicity: As with source of revenue and financial savings, median according to capita house fairness was once upper amongst White beneficiaries ($156,400) than amongst Black ($25,200) or Hispanic ($35,800) beneficiaries (Determine 6). This was once due partially to variations in charges of homeownership, with with regards to part of Black (45%) and Hispanic (43%) Medicare beneficiaries having no house fairness in any respect, in comparison to one in 5 (20%) White beneficiaries.

Intercourse: Median according to capita house fairness was once slightly upper amongst ladies than males ($131,650 vs. $116,050, Determine 6). Whilst charges of homeownership have been related (75% vs. 74%), differences in life expectancy imply {that a} greater proportion of ladies live to tell the tale to older ages, permitting extra time to amass house fairness and, when it comes to widowed beneficiaries, to possess the total proportion in their properties.

Marital Standing: The vast majority of married and widowed beneficiaries have been householders, with median according to capita house fairness of $144,900 and $209,650, respectively. Simply 13% of married beneficiaries and 20% of widowed beneficiaries had no house fairness in any respect. Against this, median according to capita house fairness amongst divorced beneficiaries was once $53,500 and 41% weren’t householders. Unmarried beneficiaries had the bottom charges of homeownership (63% had no house fairness) with median according to capita house fairness of $0 (Appendix Desk 1).

Schooling: As with source of revenue and financial savings, homeownership and median according to capita house fairness each rose with instructional attainment. Amongst beneficiaries with a faculty stage, median according to capita house fairness was once $232,650 and 15% had no house fairness. Amongst beneficiaries with lower than a highschool schooling, median according to capita house fairness was once greater than 15 instances decrease ($15,400) and just about part (47%) weren’t householders (Appendix Desk 1).

Dialogue

Whilst a somewhat small proportion of Medicare beneficiaries experience considerable wealth and monetary safety, maximum survive restricted approach, with important disparities by means of age, intercourse, and race and ethnicity. Somewhat low source of revenue and financial savings would possibly provide a selected problem to Medicare beneficiaries below the age of 65, who’re over three times much more likely than older beneficiaries to document an issue paying a scientific invoice up to now 365 days, and just about two times as more likely to document delaying or forgoing a well being care provider, reminiscent of physician visits or prescribed drugs, because of their charge.

Dwelling on a modest source of revenue and with restricted financial savings might also end up difficult for Medicare beneficiaries in older age teams, specifically older ladies, who could also be much more likely to want expensive long-term services and supports for a longer time frame, reminiscent of house well being aides or nursing house care, which Medicare generally does not cover.

Some Medicare beneficiaries could also be eligible for added enhance from Medicaid, together with the ones with very low earning and restricted financial savings, and others who spend down their belongings to pay for his or her scientific or long-term care prices. Medicaid offers coverage for nursing house care and different long-term care products and services and helps that don’t seem to be in most cases coated by means of Medicare. Alternatively, for decrease and heart source of revenue beneficiaries who don’t qualify for Medicaid, the high cost of unanticipated scientific and long-term products and services and helps would possibly merely be unaffordable.

Black and Hispanic Medicare beneficiaries have considerably decrease earning, financial savings and residential fairness than White beneficiaries, striking them at nice monetary possibility of their retirement years, with fewer sources to hide unanticipated bills. Beneficiaries of colour are much more likely than White beneficiaries to document issue gaining access to wanted well being care products and services. Price-related limitations to care are particularly commonplace amongst Black beneficiaries, who’re more than twice as likely as White beneficiaries to document an issue paying scientific expenses and greater than thrice as more likely to document having an unpaid scientific invoice referred to a set company. Having much less source of revenue to come up with the money for Medicare’s cost-sharing necessities or Medigap premiums contributes to a bigger proportion of Black and Hispanic beneficiaries enrolling in Medicare Merit plans. In doing so, they’ll face the tradeoff of get right of entry to to supplemental advantages and cheaper price sharing however extra restricted get right of entry to to suppliers.

Policymakers have put ahead plenty of methods to cut back the load of well being care spending for Medicare families. The Inflation Reduction Act of 2022 comprises a number of provisions geared toward decreasing prescription drug prices for folks with Medicare, reminiscent of a cap on out-of-pocket spending below the Medicare Phase D prescription drug get advantages, a prohibit on insulin charge sharing below Medicare Phase B and Phase D, and expanded eligibility for the Phase D Low-Source of revenue Subsidy (LIS), which assists with Medicare Phase D drug plan premiums and cost-sharing. Those provisions would possibly permit Medicare beneficiaries to spend much less on high-cost drugs and reserve extra in their source of revenue and financial savings for different well being care wishes, in addition to meals, housing and transportation, and different crucial bills. However excessive cost-sharing necessities and gaps in protection, significantly long-term products and services and helps and dental care, stay a urgent worry for the huge swath of the Medicare inhabitants residing on modest earning and financial savings.