The History Of The Medicare Benefit Program
On July 30, 1965, U.S. President Lyndon B. Johnson passed
the Medicare Benefit legislation as an amendment to the Social Security
Legislation. Medicare is a health insurance program for U.S. citizens at
least 65 years old, or those aged younger than 65 years who suffer from
certain disabilities.
U.S. citizens and permanent residents who have worked at least 10 years
in employment during which they paid Medicare benefit taxes, and who are
at least 65 years old, are eligible to participate in the Medicare
benefit coverage.
In fact, persons meeting these two requirements are
automatically enrolled the Medicare program on their 65th birthday.
Those who are not automatically eligible or who are younger than 65
years must apply to participate in the Medicare benefit program.
The original Medicare benefit program was comprised of Part A, the
hospital insurance coverage, and Part B, the medical insurance
coverage. Parts C and D have been added to address additional health
concerns.
Part A of the Medicare benefit program covers hospital stays of at
least 72 hours. It also will pay for stays in a nursing home
provided that the nursing home care is related to the hospital stay,
the patient requires skilled nursing supervision in lieu of
rehabilitation, and the Medicare benefit received in the nursing
home is skilled rather than routine. Part A coverage part is usually
free, having been paid for by the beneficiary's periodic payroll tax
deductions.
Part B of the Medicare benefit package is optional and offers
medical insurance. It covers some of the medical providers and
services not covered by Part A. A Part B Medicare benefit can
include a doctor's visit, a laboratory test, an x-ray, a flu
vaccination, and certain outpatient procedures, to name a few.
The Part B Medicare benefit is not free. Instead, the person must
choose whether or not to pay for Part B when notice of Medicare
benefit eligibility is received at age 65. In 2006, the Part B
monthly premium was $88.50.
In 1997, Part C of the Medicare Benefit system gave Medicare members
the option to receive their care through private insurance plans.
These private plans were in place of the Part A/B coverage of the
original Medicare benefit plan. Regulations for these private plans
were modified in 2003, and they became known as Medicare Advantage
or MA plans.
The Part D Medicare benefit became effective on January 1, 2006.
Anyone eligible for Parts A or B were automatically eligible to
participate in the Part D prescription drug plan. Part D added the
Medicare benefit of allowing participants to enroll in one of many
standalone, Medicare-approved prescription drug plan.
This Medicare benefit provided reduced-cost prescriptions. Each
prescription drug plan was different and had varying restrictions
related to location, participating pharmacies, and drugs covered.
Some people fear that the Medicare benefit system will eventually go
bankrupt around the year 2018. The rationale is that more people are
retiring and taking advantage of their Medicare benefit plan than
are paying into the system. Once the Baby Boomer generation is fully
enrolled in the Medicare benefit system around 2031, the membership
is estimated to be 77 million persons.
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