Medicare is insurance coverage for those 65 and older. Not to be confused with Medicaid which helps those in need to afford insurance. Medicare is currently funded primarily by the payroll tax and other sources.
There are four parts to Medicare: A, B, C, and D.
- Part A: Hospital Insurance
- Part B: Medical Insurance
- Part C: Medicare Advantage Plans
- Part D: Prescription of drug plans
- You may have heard the famous term "donut hole" when articles talk about Medicaid Part D. Basically, the insurance will cover your drugs up to a certain amount X. Once you pass that limit, you are responsible for your drugs until you spend a total amount determined by Medicaid. For 2017, you begin paying for your own drugs when you pass the limit of $3,700 until you spend a total of $4,950 in 2017.
If you are on Medicare, then you still have to pay for premiums, deductibles, and out-of-pocket costs. Don't be fooled; it's not free healthcare.
The biggest problem with Medicare is that the system oh just I don't know go bankrupt. Why? Well, Medicare can only survive if it has enough money to pay for insurance for everybody eligible for the program (aka >65 years old). In the future, we are expected to have more seniors than younger people. So what is going to happen is that we won't have enough people to pay for this program. A solution that has been floating around is to increase the age eligibility. Instead of being 65 to be eligible, you would have to be 80 or older. That way more people can pay for the program. People against this solution say that it's just another form of discrimination. It's like saying "oh we can't pay for your insurance because you have a preexisting condition" except the prexisting condition is not being old enouh.