Medicare is possibly the most efficiently run program in the federal government. With a 2 percent overhead cost, Medicare is far more efficient than commercial health insurance programs. The burden of excessive management salaries and advertisements drives the overhead costs of commercial health insurance programs to 20 percent and more – 10 times the overhead costs of Medicare.
The sources of the financial problems that Medicare faces are a “pay-as-you-go” system coupled with insuring an aged population. The financial solution to the Medicare situation is to offer this program for a fee to all age groups. The fee would be competitive with, or lower, than the present market. And, coupled with the low Medicare overhead costs, the profits generated would be used to stabilize the Medicare program.
This modification of the Medicare program will also provide everyone with an attractive alternative to the current health insurance programs.