Final answer:
The financial sustainability of Medicare, a program established in 1965, is challenged by an aging population and rising medical costs. Projections indicate a significant increase in spending on Medicare and Social Security, potentially necessitating changes such as tax increases or adjustments to eligibility age. The specific percentage the MEC pays over Medicare is not addressed in the provided materials.
Step-by-step explanation:
The question at hand involves understanding the financial aspects of Medicare, a program established in 1965 which currently comprises four parts: Hospital Insurance, Supplementary Medical Insurance, Medicare Advantage, and Part D prescription drug benefits. Hospital Insurance is mainly funded by a dedicated payroll tax, while Supplementary Medical Insurance is funded through beneficiary premiums and general revenues. As the population ages, with projections indicating that one in five Americans will be over age 65 by 2030, spending on Medicare and Social Security is expected to increase substantially. This implies that the current payroll tax will no longer be sufficient to cover the expected costs associated with these programs.
Long-term projections by the Congressional Budget Office (CBO) state that combined spending on Medicare and Social Security will rise from 8.3% of GDP in 2009 to about 13% by 2035 and 20% by 2080. With this rise, without a corresponding increase in tax collections, measures like increasing taxes, cutting other spending, raising the retirement age, or allowing the government to run large deficits may become necessary. The MEC's payment over Medicare is not explicitly mentioned in the provided materials, so an accurate percentage cannot be given. The core issue is the sustainability of funding for Medicare given demographic changes and the rising costs of medical care.