Let me help you out.........
The government puts Medicare on the balance sheet sometimes and removes it other times. Example: Clinton removed it to help balance his budget and George Bush reinstalled the liability on to the balance sheet to reflect the liability.
Medicare Part D is a drug program option for seniors. Medicare doesn't cover out patient drugs. Out patient drug coverage previously was available through supplement plans that covered what Medicare didn't.
Medicare Part D is optional. That means a senior can obtain it or not. The misunderstanding is people think it is a taxpayer cost. Not true. Or, all seniors would obtain for free. Drug coverage plan has a cost to bare by the user. Option means a senior chooses to be a user (purchase drug coverage) which he pays for through a deduction from monthly SS check. Those seniors that do not purchase plan D, do not have that deduction from their SS check nor do they have that drug benefit. In summary, those with plan D drug coverage pay for.it.......not the taxpayer.
Prior to the 1980's, drug benefits for seniors on Medicare were able to obtain drug benefits through a private company offering supplement coverage that covered what Medicare did not cover......that included 100% drug coverage after deductible. In the 1980's, supplement coverage cost was increasing extremely fast. A study by Blue Cross found 2 things :
1. Half the premium for senior supplement coverage was result of Rx benefits paid out.
2. That 0.01 percent of those covered utilized the biggest portion (95 %) of the benefit payout
3. Concluded, that senior supplement coverage could be cut in half by eliminating Rx benefit.
4. Cost could remain affordable by reducing RCA benefit to $250. Keep in mind that time period vs related benefit value.
Unfortunate, seniors were going to pay more out of pocket for Rx and cost of Rx would continue to rise. That brought up the Rx market for Rx purchases out of country cause of savings. Seniors were getting drugs from Canada, Mexico and Europe for half or greater the cost in USA. Same drug companies. This was the practice through 1990's and 2000's before Plan D legislation. Drug companies were pissed to say the least. Plan D came into the picture result of appeasing drug companies losing profits and insurance companies not interested in pooling the risk and destroying or limiting the supplement market.
Plan D is like Medicare in that it is maximizing the pool of risk to distribute the risk over the.total numbers in the pool. Your Medicare payroll deduction from you and employer match pays your contribution. And, when you reach eligible age for Medicare you will have an amount deducted from your SS check that is used to continue paying into your Medicare Part B covefurage. At that time you have an option to purchase into Plan D Rx drug pool. If you elect to purchase, the fee is an additional deduction from your SS check.
So.....my point is SS, Medicare and the optional Plan D Rx benefit are paid for through payroll deductions, contributions and deductions from SS check. We give the government the money to administrate distributions. If you terminate these plans then government has no contributions to distribute. By all reason, it should be zero sum game. But, then you have government overreaching to use funds not intended.
SS, Medicare and Plan D are self funded. Not taxpayer liability. Politicians deliberately fk with terminology to fool the masses and give politicians access to use those funds for other purposes.
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