Millions of Americans rely on Medicare, Medicaid, and Social Security to help pay the bills during retirement. However, politicians and health experts have been discussing the low funding and high costs of these programs. As time goes on, funding for Medicare and other federal programs will become a hot button issue in Congress.
How has funding changed for Medicare? What changes are likely to change in the future? Most importantly, how will these changes affect your Medicare benefits in the years to come?
Medicare began in 1965, providing healthcare coverage to qualifying citizens aged 65 or older. In its early days, the number of older adults in the United States was relatively small. There were hundreds of workers paying taxes into the system for every citizen receiving benefits. Nowadays, this ratio looks very different. Though experts argue over the exact figures, some say that there are as little as two workers for Medicare beneficiary.
What does this mean? It means that there are more people getting Medicare benefits than ever and not enough workers to pay the taxes needed to keep the program sustainable. Ever since “Baby Boomers” started reaching retirement age, the federal government has struggled to keep the program solvent. Additionally, politicians have been reticent to increase the payroll tax (the main source of funding for Medicare and Social Security), as it would take more money away from American workers.
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As far as Medicare is concerned, the country is at a major crossroads. Some people advocate for decreased benefits so that private insurance options can fill in the gaps. Alternatively, others insist on greater funding and expansion of Medicare to even more Americans. In any case, the future of Medicare remains uncertain.
The 2020 presidential campaign has shed some light on what older adults can expect. Joe Biden has proposed expanding Medicare to individuals 60 years of age and above, though it’s unclear how this expansion would be funded. Meanwhile, Donald Trump wants to implement a payroll tax cut, which could severely reduce funding for Medicare. This, in turn, could reduce benefits going forward.
No matter who wins the presidential election, there’s no doubt that some changes must be made. The current system is running over budget, while more Americans are qualifying for Medicare every day. The current COVID-19 crisis only increases the need for comprehensive healthcare among older adults.
It’s unclear how Medicare will change, but it is clear that it will change, for better or worse. In all likelihood, Congress will pass legislation to provide greater funding to the program so that it can remain solvent. This way, millions of Americans can continue getting the healthcare coverage they need.
If you’d like to learn more about Medicare funding or your Medicare coverage options, feel free to fill out this form or give us a call anytime. Time for 65’s partnered licensed agents are focused on giving you the information you need, with zero pressure to enroll in a plan.
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