Medicare became the law of the United States in 1965 under the presidency of Lyndon Johnson. It originated as an amendment to the Social Security Act. The first part of the coverage consisted of two sections, Parts A and B. Hospital stays and associated costs were paid under Part A while Part B paid for medical expenses originating from outpatient care. Although 45 million people were enrolled in the program in 2008, the growth by the year 2030 will be dramatic, rising to 78 million under current projections.

Funding for the program is borne by employers and employees equally at a level of just under three percent of payroll. The governing legislation is the Self-Employment Contributions Act of 1954 for self employed individuals and the Federal Insurance Contributions Act (FICA). Self employed workers pay both the employer and employee portions.

Eligibility for the original Part A and B of this program is offered to any U. S. Citizen age 65 or older. The premium costs are waived if the worker has paid into FICA for ten years. Part A coverage is the portion available for hospital expenses. The inpatient hospital costs such as physician and nursing care, medicines and medical procedures and tests are all covered. There is a deductible cost that must be paid out-of-pocket. Part A also covers convalescent care in a skilled nursing facility. Again, deductibles and co-payments apply.

Medical costs are covered under Part B. This part of program coverage is optional, but there will be a penalty applied if you don’t enroll. Outpatient costs of all types are paid under Part B. These costs can be anything from seeing a physician to medical equipment to prosthetic equipment. Medications that are administered by a physician are covered.

Under Part C, individuals can purchase private insurance plans for benefits offered under Parts A and B. This program section includes prescription medications. The enrollee must still pay part C premiums in addition to those of Part A if applicable and Part B. If the benefits under Part C are not included in Parts A or B, there may be additional fees.

Part D is the latest addition to the program. It was enacted into law in 2006. This portion of benefits law provides payment for prescription drug plans. It also allows for combining benefits from Part C for better coverage. This part requires additional payments for out-of-pocket expenses and monthly premiums.

Most Part A beneficiaries don’t have to pay premiums. The premiums for Part B are $96.40 monthly. These premium costs are automatically deducted from Social Security retirement benefits payments. The type of program and level of coverage determines the premium costs for Parts C and D. With some of the Part C plans, part or all of the Part B premium costs are returned to the enrollees.

There are continuing efforts to improve the administration of the Medicare payments system. Most of the complaints come in regard to physician and hospital reimbursement for services rendered. There is likely to be some changes to the regulations affecting the program, thanks to the recent health care reform legislation passed in the U. S. Congress.

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