How the ‘Medicare Cliff’ is raising costs and worsening health for many older low-income adults

When you turn 65, a rite of passage is qualifying for Medicare to cover most of your health costs. But for more than a quarter of a million of low-income Americans, that day brings them perilously to what’s known as the Medicare Cliff. These people—predominantly female and often Black or Hispanic—have significantly higher out-of-pocket medical costs compared to others with Medicare.

They also experience a substantial worsening of their health in the two years after hitting the Medicare Cliff, according to a new study by the National Council on Aging and the LeadingAge LTSS Center at University of Massachusetts, Boston. “Once they have a birthday and turn 65, we flip the switch and they plummet into a sea of costs related to health care,” says Ramsey Alwin, CEO of the National Council on Aging (NCOA). “These are the most vulnerable individuals.

” What is the Medicare Cliff? The Medicare Cliff is a combination of the Affordable Care Act’s broadening of eligibility for Medicaid and conflicting Medicare rules. The Affordable Care Act —sometimes called Obamacare—let states expand their Medicaid programs to cover low-income adults aged 19-64 with incomes up to 138% of the federal poverty level (roughly $21,000 for an individual in 2024). Before that, Medicaid eligibility was restricted to people with incomes below the U.

S. poverty rate. But that broader income amount for Medicaid ends at age 65.

As a result, roughly 280,000 Americans each year then lose their Med.