Medicare: The Ugly Truth by T. Edwin Perry
Over the past year, I’ve posted many blogs regarding the dangers of Government Run Healthcare. I’ve talked about how flawed this system may become, and the potential damage that it could cause our economy. I’ve rallied behind the argument that our Government has, historically, created these “Socialized Programs” to “Help” people, only to have them fall far short of their goals, and usually at an incredibly unsustainable cost.
Previously, I’ve addressed this shortfall in my commentary on the “Socialist Security Insurance Program.” In that commentary, I addressed the fact that this program is NOT a retirement program, and that the cost paid on every dollar you earn is a TAX that you cannot recover. Today, let’s talk about MEDICARE.
The Medicare Insurance Program is paid for through what is known as “FICA” on your withholding, or “Federal Insurance Contribution Act.” Standard employees pay 1.45% of their Gross Pay as a “Contribution” to the Medicare Insurance Program. Employers pay a matching 1.45% of that Gross Pay, for a grand total of 2.9% of your Gross Pay. (ie: If you earn $10,000 per year, your FICA Withholding is $145, and your employer pays $145.) If you are self-employed, you are required to pay 2.9% of your income to FICA. (ie: If you earn $10,000 per year, your FICA contribution through Self Employment Tax is $290.)
The FICA Withholding is called a “Contribution,” but it is, in all ways, a TAX. You do not have the option of NOT paying this tax. You do not have the option of applying that “Contribution” to some other healthcare plan. It is a Tax – Period.
Medicare is thought by most to be “Free” Healthcare for the elderly, and, I’ll admit, I once believed that. In fact, I believed that the only cost to the individual to get Medicare Coverage was taken during the years they are working through the FICA Withholding. But, like many who believe these things, I WAS WRONG!
That’s right. I’m the first to admit when I’ve made a mistake. I was wrong. The costs of Medicare Coverage do not stop with your FICA withholding. And Medicare is not a “Healthcare” plan. It was created for emergencies. Hospital stays, and emergency care. Much in the same way that Social Security was created to support those few who lived significantly longer than most, Medicare was not ever intended to provide long-term healthcare, but to absorb the costs of those at the end of their lives. But, since, just like Social Security, the idea of Medicare has been misrepresented to the millions who now rely on it, let’s talk about the ACTUAL costs of Medicare, shall we?
Medicare Part A: If you paid Medicare taxes for more than 10 years, this part of Medicare is FREE, and covers Hospital Rooms, Meals, Nursing Services and Hospice/Home Health Care. (If you paid Medicare taxes for less than 10 years, the monthly premium for Part A could be as high as $461.00 per month.) Note that this “FREE” Healthcare Plan DOES NOT cover Doctor Visits, Prescriptions, Tests or Treatments, such as surgery or X-Rays. Part A is about making you comfortable as you prepare to die, not to keep you from it.
Medicare Part B: If you are eligible for Part A, you can enroll in Part B for an additional monthly premium. Part B pays for Doctor visits and outpatient Doctor services; Laboratory & X-Ray tests; Physical Therapy & Rehabilitation; some Home Health Care services; and medically-necessary medical equipment & supplies, such as oxygen & diabetic testing supplies. The patient is responsible for a 20% co-pay, and a monthly premium, which is deducted from eligible Social Security benefits. (Currently, the cost is approximately $100 per month. Chump Change, right? Ask someone living on $1,300 per month of Social Security Benefits.)
Medicare Part C: These are called “Advantage Plans,” and are private insurance that is “Medicare Approved.” For an additional monthly cost, this supplemental insurance covers those parts of Part A & Part B that are not covered, as well as some of the Part D costs (See below). These plans are paid for privately by the patient, and vary in cost. In other words, it is a HEALTHCARE PLAN, and IS NOT covered by your FICA Taxes paid throughout your working life.
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