How the Medicare System Impacts Patients and Physicians


Say, today, you’re a relatively healthy 45 year old individual. Do you know you’ll end up paying more for Medicare than you’ll receive from it? According to John Goodman’s Healthcare Blog, your age will play a role in whether or not you come out ahead.

Because patients pay the payroll taxes while they’re working, the premiums during retirement, and their share of the income taxes that subsidize the system, they can spend more on the services than what they ultimately receive from the system. John highlights some insightful statistics about how one’s age can impact how far ahead – or behind – they come out in the Medicare arena.

According to the National Center for Policy Analysis, those individuals over 50 will come out ahead, while those under 50 will end up paying more than they’re receiving. Here’s the breakdown:

  • A typical 85-year-old will get back $2.69 in benefits for every dollar paid into the system in the form of premiums and taxes
  • People turning 65 today will get back $1.25 for every dollar they pay in
  • The average worker under age 50 will get back 95 cents on the dollar
  • A 25-year-old will get back 75 cents for every dollar they contribute


Under the Healthcare Reform Act, Medicare reimbursements are being cut 21-29.5% (and all 3rd party payors are heavily incentivized to follow suit). This means that for physicians that have 60% overhead costs, a 21% cut in reimbursement rates will result in a 53% reduction in take home pay, while a 29.5% cut will reduce a physician’s income by 74%!

These scenarios are a reality that will influence the lives of both patients and doctors. Many doctors will stand by idly, wondering how they can remain unaffected by this major change. Many patients will continue to be misled by the system.

For those who opt into the security of concierge medicine, the threat of Medicare cuts and an influx of patients will not be a concern. Personalized physicians will be able to increase their take home pay, see fewer patients and avoid issues, such as Medicare reimbursement cuts, which allows them to better focus on their patients – and ultimately meet their patients’ demands.