Medicare: A primer on that abomination

From the Denver Post: Op-Ed by David Harsanyi

Great piece with a very interesting bit of data.

"Remember that Congress estimated Medicare's cost at $12 billion for 1990 (adjusted for inflation) when the program kicked off in 1965. Medicare cost $107 billion in 1990 and is quickly approaching $500 billion."
I don't know much about Medicare so I went to Wiki to glean some more interesting facts.

Medicare Page on Wikipedia:

"Medicare is a social insurance program administered by the United States Government providing health insurance coverage to people who are aged 65 and over, or who meet special criteria. Medicare operates as a single payer health care system. The Social Security Act of 1965 was signed into law by President Lyndon B. Johnson as amendments to Social Security legislation."
Taxes imposed to finance Medicare
"Medicare is partially financed by payroll taxes imposed by the Federal Insurance Contributions Act (FICA) and the Self-Employment Contributions Act of 1954. In case of employees, the tax is equal to 2.9% (1.45% withheld from the worker and a matching 1.45% paid by the employer) of the wages, salaries and other compensation in connection with employment."

Cost and Funding Challenges

"The costs of Medicare doubled every four years between 1966 and 1980."

"Medicare spending is growing steadily in both absolute terms and as a percentage of the federal budget. Total Medicare spending reached $440 billion for fiscal year 2007 or 16% of all federal spending and grew to $599 billion in 2008 which was 20% of federal spending. The only larger categories of federal spending are Social Security and defense."

"Richard W. Fisher, President of the Federal Reserve bank of Dallas has remarked that in order to "cover the unfunded liability" for the Medicare program today over an infinite time horizon, "you would be stuck with an $85.6 trillion bill" which is "more than six times the annual output of the entire U.S. economy."

"The present value of unfunded obligations under all parts of Medicare during FY 2007 over a 75 year forecast horizon is approximately $34.0 trillion. In other words, this amount would have to be set aside today such that the principal and interest would cover the shortfall over the next 75 years."
So, Big Brother runs it, it has cost nearly 10 times more than they projected it would when it started, and that's what they want to do to "normal' healthcare? Sounds peachy. What could go wrong?

Down with Big Brother!


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