Medicare is a health insurance program funded and administered by the federal government that covers people 65 or older, younger people with disabilities, and patients with end-stage renal disease. It is not a welfare program and should not be confused with Medicaid, another government-run health coverage program.
The aim of Medicare is to provide medical care for all Americans aged 65 and over and for individuals who are eligible for Social Security Disability benefits. In addition, the Medicare site provides insurance for individuals who are covered by a group health plan through their employer or spouse’s employment.
What is Medicare?
Contents
There are four parts to Medicare: Part A (hospital insurance), Part B (medical insurance) and Part C (Medicare Advantage). All of these cover inpatient hospital stays, care in a skilled nursing facility, hospice and some home health services.
Generally, Medicare Part A is financed through payroll taxes paid by employers and employees. Part B is financed by premiums paid by beneficiaries and general revenues from the federal government.
Costs and Out-of-Pocket Aspects of Medicare
As the population ages, Medicare spending is projected to increase significantly. This is because the baby boom generation has triggered the age of eligibility for Medicare and because health costs have increased significantly.
In order to control spending, policymakers have been looking at various payment and delivery system reforms. They are experimenting with different models that aim to link payments for Medicare-covered services to quality and value targets.