We're blessed to live in a country that offers us some protections. The poor can get food, shelter, and healthcare. Not quite up to European standards (and our standard of living isn't quite as high as, say, Norway's), but not too bad.
But the way these systems work can create problems.
For example, let's say your family can get Medicaid if you make $16,000 or less a year. If you make $16,001, you can't get Medicaid. Now, Medicaid is worth a lot more than one dollar. So, really, you get more benefits if you work just a little bit less. With the price of health insurance these days, those benefits can be quite significant.
An intelligent government healthcare plan would, like Medicaid, be based on the poverty line. But it would change by degrees. If you make less than 80% of the poverty line, you'd get Medicaid for free. At 80%, you'd pay a small fee for Medicaid. That fee would increase slightly at 90% of the poverty level, and continue increasing slightly, depending on your income and family size, until you're paying for it at cost.
That way, no one gets a significantly better deal by working less, poor people have an incentive to work, and those who make just over 90% of the poverty level don't get screwed over (like they do now).
Of course, all of this would require some sort of government option--but the government option already exists. You just have to stop working to get it. And that's the problem.