Is Medicare a Self-Sustaining Program?

When the bill that created Medicare was passed in the 1960s, it was intended to be a self-sustaining program. Shortly after its creation, the creators quickly found out how wrong they were. The government-run health insurance program has become an entitlement that has many more people enrolled in it than the designers envisioned. Although it is not a self-sustaining program, Medicare is a valuable resource for the people who need it.

Who Is Entitled to Medicare

Medicare covers older Americans and many people with disabilities. Many of these individuals could not get traditional insurance more cheaply through a private insurance company. The recent health care law changes may change this unless it is overturned through judicial or congressional action.

Spending on the program has always increased since its inception, even when cuts were claimed. A spending cut to the government is reducing the rate of increase for money the government intends to spend for the next year. Because of the increasing costs, the board that administers medicare has gotten more strict about claims and filling out the paperwork. The amount the program reimburses has declined over time.

Could Medicare Be a Self-Sustaining Program

Medicare is capable of becoming a self-sustaining program, but not the way it is currently run. One of the reasons it is not self-sustaining is because it ensures people who are uninsurable. Part of the budget that the government uses for Medicare is also allotted to state-run Medicaid programs.

If the government ran Medicare more like a business concerned with making a profit, the program would cease adding to the federal deficit. Because insurance companies can for the next few years deny people based on pre-existing conditions, this may not be the best idea. Getting people off the rolls who do not need it can reduce the rate of health insurance cost increases.

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