What Are The Unfunded Liabilities of Medicare?

Turn on the news and you will see some people beginning to talk about huge unfunded liabilities of Medicare, that these liabilities prove that government programs often cost a lot more than anticipated, and that these programs therefore should be put into the hands of private companies.

Recent statistics show that the Medicare program cannot continue in its current form and that major changes are needed to fix this government health insurance program. What are these unfunded liabilities, and how will they affect you?

In essence, the unfunded liability is the gap between the amount that Medicare or Social Security takes in through taxes, and they amount they expect to pay out. The unfunded liability is merely a projection, it is not something set in concrete.

Many government health insurance program in Europe, like in Germany have struggled for many years and can be considered to be on the brink of bankruptcy. And you know who is paying there to keep it alive. The tax payer.

Currently Medicare and Social Security supposedly have enough money to cover what they payout, but I expect that the government is already printing money to pay the Medicare bills, because I don’t believe that US Treasury Bonds are selling well in the near future. Even though we heard that the current administration doesn’t expect to raise taxes on the middle class, it will the middle class who will see taxes in form of higher prices and other higher fees.

As far as who will be the lenders for Medicare, I would say primarily China and perhaps Germany (which is humorous because Germany supposedly is struggling with its own health care system), but the Dollar is weak and disenchantment with America’s spending policies is rising, so the burden will probably fall onto the American taxpayer.

Why can’t Medicare be sustained? Some people say that Medicare already was bankrupt in’65, the year it was introduced under Lyndon Johnson. Others expect it to collapse within the next ten years.

When the Medicare Modernization Act of 2003 was signed into law by George W. Bush, it was in the name of “honoring the commitments of Medicare to all our seniors,” but he might not have realized the consequences for a society which has more elderly people than young. He also probably did not expect that the economy would collapse the way that it has over the last six or seven years.

Examples of Ohio Health Insurance videos from TopSeekInc: Ohio Medicare Insurance RX and Ohio Medicare Supplement Insurance RX

categories: Health,Insurance,Health care,Medicare,Seniors,Finances