Medicare is financed by payroll taxes, making it a contribution based insurance paid over a lifetime. This is a common sense approach that spreads out the risk over time and the entire population, which is virtually certain to need health care of some kind. Before Medicare, only 51% of people aged 65 and older had health care coverage, and nearly 30% lived below the federal poverty level.
There remain major gaps in insurance coverage and despite important improvements included in the Patient Protection and Affordable Care Act, nobody is really pleased with 'Obamacare' so a simple, cost-effective alternative should replace the cumbersome and wasteful existing structure.
Medicare currently provides health insurance for all people age 65 or older, under age 65 with certain disabil