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Does Medicare benefit the poor?

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Narkos Donating Member (919 posts) Send PM | Profile | Ignore Sat Apr-03-10 11:04 PM
Original message
Does Medicare benefit the poor?
I've been having this ridiculously long argument with a winger about HCR. He claims that the program represents a "redistribution of wealth" by virtue of the Medicare taxes raised on those making more than 250K. He claims (without any supporting evidence) that those who will be hit with these taxes will get less out of Medicare than they put in, therefore it's the conservative bugaboo about "redistribution". I came across a paper (incidentally by the brother of former Bush press secretary McClellan) in which he states We find the distributional consequences of the Medicare program are roughly neutral in dollar terms; households living in high income neighborhoods pay more in taxes, but they also receive more in benefits." It gets complicated, but the paper argued that even though the rich actually receive more benefits, in terms of "utility", the poor actually end being the winners, therefore it is a redistribution from the rich to the poor. Here's the paper:
www.dartmouth.edu/~jskinner/Papers/medicare%20v5.7_revised.pdf

Any thoughts? I think I have a good argument that Medicare is not that progressive, but in fact is slightly regressive.
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jody Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Apr-03-10 11:18 PM
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1. For worker, 2.9% are paid by employee & employer on all earnings. Those stats show that
people with low earnings probably do not pay enough for Medicare insurance to which they would be entitled at the proper age and their insurance coverage would be paid for by future wage earners.
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Narkos Donating Member (919 posts) Send PM | Profile | Ignore Sat Apr-03-10 11:44 PM
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2. Therefore it is progressive? n/t
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jody Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Apr-04-10 09:21 AM
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3. Progressive usually means increasing % so it's not progressive because everyone pays the same %. n/t
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