Workers across the United States have their paychecks docked each pay period with the federal government taking taxes out to support federal programs. One of the largest federally funded programs in the U.S. budget is Medicare health insurance coverage. Many see the tax taken from their paycheck without understanding exactly what they are helping fund.
Medicare health insurance provides insurance coverage for millions of individuals across the United States with the benefit of lower costs compared to health insurance offered by private companies. Only certain individuals are eligible to collect the benefits provided by Medicare health insurance. Anyone over the age of 65 who has paid into the Medicare system through their own payroll taxes, or those of their spouse, are eligible to take advantage of the health insurance offered by Medicare. Other individuals are eligible including those under 65 who suffer from illnesses or disabilities such as End Stage Renal Failure and A.L.S.
Current Medicare health insurance provides beneficiaries with coverage for hospital visits, general medical care provided by doctors, and prescription drug expenses. Medicare Part A provides beneficiaries with coverage for visits to hospitals or stays in skilled nursing facilities and hospices. In certain situations, Medicare Part A will also pay for in home health services for those unable to leave their home. Medicare Part B provides insurance coverage for individuals to see their general practice doctor for checkups and other exams. Medicare Part D helps individuals pay for necessary prescription drug coverage ordered by doctors.
Medicare Part C was developed to provide beneficiaries with an alternative to Medicare’s Part A and Part B service. Through Part C, beneficiaries can obtain Part A and Part B Medicare coverage through private insurance companies that have been approved by Medicare as an alternative to its own health insurance coverage.
However, Medicare is far from perfect with several problems that have plagued the system over the years and some which continue to hamper the health insurance coverage it offers. Medicare Part C was developed initially in response to some of the problems that plagued Medicare when it was just Part A and Part B. Some individuals were left with high co-insurance, co-payments, and other premium payments that weren’t covered by Medicare. However, by choosing an approved private insurance company for Medicare coverage, individuals could avoid out of pocket costs and gain other service coverage Medicare didn’t offer such as vision, dental, and hearing.
Medicare Part D has also suffered problems with some individuals unable to pay their portion of prescription drugs. Not all Part D plans cover all the medications individuals might need, and those plans that do come with premium payments come with a high cost. Opting for a Part C plan is one way for individuals to get around this problem, as many plans offered by private companies through Part C include prescription drug coverage.
Medicare Supplemental Insurance, or Medigap, was also developed to help individuals with Part A and Part B coverage close the “gap” on service costs and avoid facing out of pocket payments they could not afford.
One of the biggest problems faced by Medicare health insurance isn’t its coverage but instead with its financial footing. As medical costs increase year after year, the expenses incurred by the Medicare program come dangerously close to outpacing its income through taxes. Further stressing the program is the fact that a larger number of citizens are drawing from Medicare than ever before and the number of workers contributing funding to the program is shrinking. There are currently 3.4 individuals supporting each individual on Medicare, but it is estimated that by 2020 there will be just 2.9 individuals supporting each individual relying on Medicare.
For all the problems of Medicare, it does have tremendous upside for many eligible individuals. Medicare was initially developed in the 1960s because many senior citizens were becoming increasingly unable to obtain affordable health care from private companies as premiums and other costs skyrocketed beyond their financial capabilities. Senior citizens are particularly vulnerable when it comes to medical conditions and are often in need of extensive care. Medicare covers nearly 45 million Americans, 38 million of whom are senior citizens.