Medical care for aging baby boomers
Medicare is a government-sponsored health insurance program for most people who are 65 or older, although some disabled people under the age of 65 also may qualify.
It is a two-part program. Part A provides hospital benefits for short-term illness. It also provides some benefits for nursing facilities or home care.
Individuals 65 or older who don't qualify for Medicare can still receive it by paying a monthly premium, which is generally adjusted yearly according to age and medical need.
Part B Medicare, which pays most medical and surgical fees, is optional medical insurance, which is available for a small fee each month. The premium can be automatically deducted from the recipients' monthly Social Security benefit check.
As the baby boom generation ages, money spent on health care most likely will increase dramatically.
The primary reason why health insurance underwriters charge so much to insure people over 65 is because they use more health care services.
Since 1995 Medicare beneficiaries have paid an annual average of $3,063 per person extra for supplemental insurance premiums, medical services, medical products, and medicines that were not covered by the program—almost one-third of their health care expenses.
Who will pay the bill?
As costly as Social Security is, the potential cost of Medicare over the next two decades far outweighs all other social or entitlement programs.
The only logical way to make a system solvent that is providing health care for the costliest group—age 65 and older—solvent is to manage it with the least costly group—ages 20 through 35—and raise the prices for everyone.
So, unless there is a major breakthrough in health care that inhibits the aging process, the younger generation of families will be forced to pay for the care of the older generation.
However, because of the steadily declining birth rate due to readily available abortion, which claims the lives of over one million yearly, smaller families, and couples who choose to start families later, there are fewer workers to pay for elderly health care.
In 1960 there were 4.5 American workers per person aged 65 or older.
At the current rate of population expansion, by the year 2040 there will be 2.2 American workers per person aged 65 or older.
Therefore, half the number of workers will be responsible for paying the medical bills of more than twice the number of elderly.
Politically, the generally accepted method by which these increased expenses will be paid is by steadily raising workers' taxes, while at the same time cutting the medical coverage offered by Medicare.
Is this the best way to cover the cost of medical care for the elderly?
When the first of the 77 million baby boomers begin entering the federal Medicare system in the year 2011, annual Medicare expenditures will climb from $201 billion to between $2.2 and $3 trillion before that decade is complete.
That means that workers' taxes will have to quadruple just to keep pace.
Alternative to steadily increased taxes
Unless workers' taxes are raised immediately and regularly over the next two to three decades, the cost of medical care most likely will never be met by the revenues generated from Medicare taxes.
Although raising taxes to some extent is a foregone conclusion, it has always been unpopular with the American worker, and it is generally viewed as political suicide for proponents to any tax hike.
Therefore, although that is exactly what will be needed if quality medical coverage is to be provided for the elderly, it is highly unlikely that the average American worker will have to withstand a quadrupling of his or her Medicare tax burden over the next couple of decades.
So, how can medical costs of the elderly be covered? Is there an alternative to raising taxes beyond acceptable and reasonable levels?
Medicare supplemental insurance
Medicare supplemental insurance could be a logical and affordable answer to the question of rising medical costs for the elderly.
This type of insurance is designed to take up where Medicare leaves off, and it is relatively inexpensive for the amount of coverage it provides.
A good supplemental policy should cover a whole range of health problems, including pre-existing conditions.
It also should provide for long-term custodial care—nursing home or home care—and should give the option of using facilities other than those approved by Medicare.
If supplemental insurance is not affordable, there are other options.
A major medical plan can generally be purchased very inexpensively. This is medical insurance that usually has a high deductible but will pay for catastrophic illnesses or major surgery.
Often retirement organizations, like AARP, offer supplemental hospital insurance that pays the insured a certain amount for each day spent in a hospital and an additional amount in case of surgery.
Not all organizations and associations offer hospital supplementary insurance, so if interested contact the member association.
Another option is to begin immediately to set aside into a medical savings account a monthly amount (a minimum of 5 percent of net monthly income) that will be used to help defray major medical expenses.
As the average age in America continues to climb, the need for medical coverage for the elderly will continue to increase.
However, increasing workers' tax burden may not be the best solution to handle the inevitable rise in medical costs to care for the elderly.
Private insurance and savings could go far in helping to supplement Medicare coverage.
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