Medicare

A federal program of health insurance benefits, without regard to the beneficiary’s income, for those age 65 or over, for certain disabled persons, and for persons with end-stage renal disease. The program was established as Title XVIII (Health Insurance of the Aged) of the 1965 Social Security Amendments and became effective on July 1, 1966. It consists of two separate but related components: hospital insurance (Part A) and supplementary medical insurance (Part B). Part A covers all Medicare-eligible persons and requires no premium, but does require a deductible per benefit period. There is a co-payment requirement: per day from day 61 to day 90 of a period of illness; increasing co-payment per day for each of 60 lifetime reserve days; and a co-payment per day for days 21 through 100 of extended care services in a skilled nursing facility. The 1983 Social Security Amendments (PL 98-21) established a prospective payment system for Medicare Part A, based on diagnosis related groups (DRGs). Part B is optional, requires a monthly premium, and has a deductible per year. There is a coinsurance requirement for a certain percentage of physician charges, unless the physician accepts assignment (the rate assigned by Medicare). Medicare Part B is supported by United States Treasury contributions as well as by participant premiums. [Sources: National Coalition on Catholic Healthcare Ministry, 1995; Starr, P., The Social Transformation of American Medicine (New York: Basic Books, Inc., 1982); and Friedman, E., "The Compromise and the Afterthought. Medicare and Medicaid after 30 Years," JAMA 274 (1995): 278-82.]

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