ECN 212 Study Guide - Final Guide: Health Maintenance Organization
Document Summary
Chapter 19 aging, social security, and health care. Over 13 percent of the total u. s. population is 65 years or older. Social security: social security is financed by payroll taxes levied on both employee and employer. Currently, workers and employers each pay 7. 65 percent of income (6. 2 percent on the first ,200 in 2006 for the social security contribution and 1. 45 percent on all earnings for the medicare contribution). Teaching strategy: explain that social security is operated on a pay-as-you-go system and is not a bank account that an individual has at the u. s. treasury. The viability of social security: social security expenditures have risen more rapidly than any other government program. Teaching strategy: show that who pays the tax depends on labor demand and labor supply curve elasticities. If labor supply is perfectly inelastic, the worker pays the entire tax, whether the tax is imposed on employers or employees.
