How Should Congress Address the Medicare Crisis?

Abstract

The Medicare program was initiated in 1965 when the federal Social Security Act of 1965 was passed. Title 18 of this act established a two section provision for the Medicare program. Part A, which provides health benefits to its beneficiaries, protects them against hospital related costs. This provision is financed through a 2.9% Social Security payroll tax. Part B provides supplemental medical insurance benefits to protect enrollees against the costs of physician services, supplies, tests and some home health services. This provision is financed through voluntary premiums and matched by funds from general revenues.