Medicare Benefits Programs – A Brief History of the U.S. Medicare System
It was July 30th, 1965 when President Lyndon B. Johnson passed an amendment to the Social Security program known as the Medicare Benefit legislation. Medicare is a United States health insurance program for US citizens of at least 65 years of age, or individuals with certain disabilities who are under the age of 65.
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.
As a matter of fact, individuals who meet these requirements are enrolled in the Medicare program automatically when they reach the age of 65. Those not eligible for automatic enrollment or who are below 65 years of age are required to apply for the Medicare Benefit program on their own.
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.
Part B benefits are not free. You must choose whether or not you want Part B, if you do choose you have to pay when you turn 65. $88.50 was the monthly cost of Part B in 2006.
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.
On the 1st of January, 2006, Part D of Medicare was brought into existence. If you were able to get Part A or Part B you were considered eligible to receive the Part D prescription drug plan. Thanks to Part D, you could participate in many Medicare-approved, standalone, prescription drug plans.
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.
There’s rather frightening evidence that Medicare will be completely bankrupt as early as 2018. It’s simple math, there’s a lot more money coming out of Medicare than there is going in. By 2031 it’s estimated there will be around 77 million people from the Baby Boomer era enrolled in medicare.