What you pay for Medicare won’t cover your costs

Posted by Kendall Harmon

Consider an average-wage, two-earner couple together earning $89,000 a year. Upon retiring in 2011, they would have paid $114,000 in Medicare payroll taxes during their careers.

But they can expect to receive medical services - from prescriptions to hospital care - worth $355,000, or about three times what they put in.

The estimates by economists Eugene Steuerle and Stephanie Rennane of the Urban Institute think tank illustrate the huge disconnect between widely-held perceptions and the numbers behind Medicare's shaky financing. Although Americans are worried about Medicare's long-term solvency, few realize the size of the gap.

"The fact that you put money into the system doesn't mean it's there waiting for you to collect," said Steuerle.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHealth & Medicine* Economics, PoliticsEconomyThe U.S. GovernmentBudgetThe National DeficitPolitics in General

32 Comments Posted December 31, 2010 at 3:26 pm

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