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Medicare (United States)

From Academic Kids

Medicare is a program of health insurance for the elderly and disabled in the USA. It was first passed on July 30, 1965 as amendments to Social Security legislation.

Medicare is partially financed by a tax of 2.9% (1.45% withheld from the worker and a matching 1.45% paid by the employer) on wages or self-employed income to a specified maximum (currently there is no maximum).

Generally, Medicare is available for people age 65 or older, younger people with disabilities, and people with End Stage Renal Disease (permanent kidney failure requiring dialysis or transplant). People under 65 and disabled must be receiving disability benefits from either Social Security or the Railroad Retirement Board for at least 24 months before automatic enrollment occurs.

Medicare has two parts: Part A (Hospital Insurance), and Part B (Medicare Insurance, helps cover doctors' services, outpatient hospital care, and some other medical services that Part A does not cover). Neither Part A nor Part B pays for all of a covered person's medical costs. The program contains deductibles and co-pays (payments due from the covered individual). Certain medical needs such as prescriptions (until 2006) are excluded. Part A is paid from the U.S. Government's general fund. Part B is paid for by the general fund and by contributions from the covered persons by way of a deduction from their monthly social security check.

In 2003, Medicare provides health care coverage for 40 million Americans. Enrollment is expected to reach 77 million by 2031, when the Baby Boom generation is fully enrolled.

It is administered by the Centers for Medicare and Medicaid Services (CMS) (formerly the Health Care Financing Administration) in the United States Department of Health and Human Services.

With regard to physicians, Medicare uses the Resource-Based Relative Value Scale (RBRVS) to determine how much money each doctor should earn, although it is criticized for not paying doctors enough because of the low conversion factor. Because of the nature of RBRVS, it is possible to pay all doctors more or less depending on how much money the person paying (CMS in this case) is willing to pay.

For institutional care such as hospital and nursing home care, Medicare uses prospective payment systems. A prospective payment system is one in which the health care provider receives a set amount of money for each episode of care provided to a patient, regardless of the actual amount of care used.

A prescription drug coverage was added in 2003 to take effect in 2006. Medicare also covers medical devices, such as scooters and powerchairs for those with mobility impairments.

Like all health systems, whether funded and managed by governments or privately, Medicare faces continuing severe financing issues. In the United States, health care is a matter of intense continuing debate.

Part of the cost of Medicare is fraud (See insurance fraud), which Medicare estimates costs it billions of dollars a year.

Legislation

See also:

External links

  • Medicare (http://www.cms.hhs.gov/medicare/)
  • Medicaid (http://www.cms.hhs.gov/medicaid/)
  • Kaiser Foundation (http://www.kff.org) Wide range of free information of Medicare program and other U.S. health issues.
  • State Health Facts (http://www.statehealthfacts.org) Data on health care spending and utilization, including in Medicare.
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