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Medicare Benefits the Rich the Most
People living longer means they are making more Medicare claims, which could damage Medicare for the future.
Donna Parkins, a 75-year old cancer survivor, has just completed her second round of chemotherapy. She works full-time at Broadway & Mexico Self Storage in Denver and receives rent-free housing above the office. Parkins relied on Medicare benefits to pay for her cancer treatments, but she is worried the funds won't last.
"I've paid into it my entire life and now he wants to take it away from us. And I was told that after 75 I cannot have anymore lifesaving procedures because of Obamacare," said Parkins.
Like many in her baby boom generation, Parkin's longevity may have a serious impact on Medicare.
A recent study by Rice University and University of Colorado Boulder shows people with higher incomes on average live about five years longer than those with lower incomes.
The strain on Medicare comes from people with more income living longer and making more Medicare claims. Then those people receive more Medicare pay-outs.
"He's already raised our medical costs by taking away benefits, so I'm frightened that we'll lose our country to a dictator," stated Parkins.
Both President Obama and Republican Presidential Candidate Mitt Romney have advertised plans to fix Medicare, but their ideas on what to do are on opposite ends of the spectrum.
President Obama's Affordable Care Act will reduce spending by 1.3 percent of GDP in 2030, and 2.2 percent in 2040 according to the Medicare Trustee's Report. The government's financial outlook won't improve from the savings though.
Instead, the saved money will be spent on other areas of the budget, such as expanding health insurance to 30-million Americans.
Medicare actuaries also predict that lawmakers will have to allow for faster growth in spending by 2035. Otherwise beneficiaries will have a hard time finding providers who will accept their insurance.
"A lot of doctors are saying they're going to quit business if it goes through because they'll all be paid the same salary no matter what they do so I'm scared to death for the future," said Parkins.
GOP Candidate Romney and his running mate Paul Ryan claim their plan for Medicare will not affect anyone currently 55 or older.
Their plan will help future beneficiaries with fixed premiums depending on their income, according to Politifact.com.
This voucher plan could be used toward a traditional Medicare plan or a private plan that meets set government standards.
Romney also said that over $716-billion in Medicare spending reductions, over the next decade, would be restored.
But Marilyn Moon, Vice President and director of the health program at the American Institutes for Research, calculated that restoring $716-billion in savings would increase premiums and co-payments by $342 a year on average over the next ten years, and $577 by 2022.
Financial problems on both sides will affect not only the federal budget, but also future taxpayers and Medicare enrollees.
"I would like it to be put back to the way it was and be there for our future generations. It's worked well for us so far and they may need some fine tuning, but they could do that without cutting the benefits and raising our costs," said Parkins.
With all of the possible plans about the future of Medicare, Parkins believes she and many others have good reasons to be afraid of what's to come.