Medicare Was Initiated in 1966 to Provide

Medicare was initiated in 1966 to provide healthcare coverage to senior citizens who were otherwise uninsured. It has often been said that the costs of providing Medicare coverage has far exceeded the funding available to support this program and thus the whole system is in crisis. However this may not actually be true. Even though it is true that Medicare costs have exceeded government's initial estimates but so have the income level of Americans over the years which helps in raising the funding sources significantly. We must understand that Americans need to contribute to Medicare payments during their working years and with higher income, more money goes into Medicare funds which, helps in meeting the rising costs of this program.

Medicare is primarily funded by the payments made by citizens during their working years. While still working, Americans need to pay a certain percentage of their income to Medicare so they can utilize this program after they retire. Taxpayers' money is thus the primary funding source for Medicare. Many people think that Medicare is an insurance program and not a welfare program. I believe this perception is correct because in certain conditions, beneficiaries are also required to pay co-payments and premiums. Secondly it is their own money which is now being paid to them after retirement so this is insurance and not exactly a free welfare program.

Medicare program is needed because a large number of people over a certain age would find themselves without healthcare insurance when they need it the most. This is because many of these people would have retired by then and hence without enough income to pay for insurance. Hence the presence of Medicare makes it easier for these people to meet the high costs of drugs as well as hospital care. Government should play an important role in providing healthcare because insurance companies charge a very high premium which not everyone can afford. But healthcare is needed by everyone especially children and the elderly. Government must therefore step in to provide adequate healthcare to those who need it the most.

With government providing healthcare to certain sections, the insurance industry may face some challenges but its survival is definitely not at stake because there is a very large percentage of population that is using the services of the insurance industry by utilizing employer provided plans or buying individual plans. We must understand that not everyone meets the eligibility requirements for government sponsored healthcare insurance and hence those who are ineligible still need insurance and they always turn to commercial insurance companies for assistance.