There's a pretty simple explanation for why hospitals and some insurers would favor raising the eligibility age: Hospitals receive higher payments from private insurance than they do from Medicare. The payments that hospitals receive from private insurers are 28 percent above the break-even point for providing treatment, according to a recent report from the Blue Cross Blue Shield Association. Medicare pays only 91 percent of what it costs a hospital to provide care.[...]

"At this point we're dealing with a situation where, if something raises money and it's not raising money from me, than its not a bad thing," says Ian Spatz, a senior adviser on the health care industry at the law firm Manatt. "If it's something that's not directly cutting you, that's better."

The pushback on the policy proposal, rather, is likely to come from other stakeholders. States, employers and seniors would all suffer if the Medicare eligibility rules were changed. It would shift about $11.4 billion in new costs to those parties while saving the federal government only $5.7 billion, according to the Center on Budget Priorities and Policy.