What Are The Unfunded Liabilities of Medicare?
If you turn on the news you will see that some people are starting to discuss the tremendous unfunded liabilities of Medicare, that they prove that government programs typically cost much more than expected, and that they should be placed into the hands of private companies.
According to recent statistics the Medicare system is it’s present form unsustainable and that there have to be major changes to fix this government health insurance program. So 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.
Medicare and Social Security supposedly have sufficient funds to cover their current expenditures, but I would guess that the government is already printing money to pay Medicare’s bills because I don’t believe that US Treasury Bonds will sell well in the immediate future. Although we hear that the current administration does not anticipate raising taxes on the middle class, it will be the middle class who will see higher taxes in the form of higher prices and other higher fees and charges.
I would say that primarily China and possibly Germany will be Medicare’s lenders (somewhat amusing as Germany is said to be having difficulties with its own health care system), but because the Dollar is weak and disenchantment with America’s spending policies is rising, it will more than likely end up on the shoulders of America’s taxpayers.
So why is Medicare not sustainable? Some people actually say that Medicare was already bankrupt in’65, when it was introduced under Lyndon Johnson, while others expect to collapse within the next 10 years.
When George W. Bush signed the Medicare Modernization Act of 2003 into law in the name of “honoring the commitments of Medicare to all our seniors”, he might have not thought of the consequences of a society with more elder than young people. Plus he probably didn’t think that the economy would tank as much as it did over the last 6 or 7 years.
Samples of Ohio Health Insurance video clips from TopSeekInc: Ohio Medicare Insurance RX and Ohio Medicare Supplement Insurance RX