Medicare Benefits Programs: A Brief History of Your Healthcare Benefits
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.
United States citizens and permanent US residents who have been employed for at least 10 years and have paid Medicare benefit taxes and are at least 65 years of age are eligible for Medicare 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.
In its original form, Medicare was comprised of both hospital insurance coverage and medical insurance coverage. But the coverage has been extended to include more 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.
Part C was instituted in 1997 and let medicare members choose to get care from private insurance plans. Those chosen private plans were used in place of Part A and Part B plans. The Medicare Advantage (MA plans) were born when the standards for private plans were modified in 2003.
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.
These plans gave many reduced-cost prescription benefits. For each drug prescription plan there were separate restrictions that were different based on location, drugs covered, and participating pharmacies.
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.