Once Upon a Time in America (June 30)

On this day in United States history in 1965 President Lyndon B Johnson signs the Social Security Act of 1965 into law.

This law created the Medicare and Medicaid programs, which provide health insurance for the senior citizens and those in poverty.

The Social Security Act signed into law by President Franklin Roosevelt in 1935 did not include any medical benefits although he wanted to have it included.

After the election of 1964, Congress began work on a bill to gain health care coverage for the elderly. This bill became a priority in Johnson's agenda.

The bill was signed in Independence, Missouri and marked the country's first public health insurance program. At the bill signing ceremony, the first Medicare card was issued to former President Harry S Truman.

SOME BASICS:

Medicare

This program is financed by payroll taxes (FICA) and is equal to 2.9% (1.45% paid directly by the employee).

Eligibility is limited to senior citizens (65 years and older) who must be U.S. citizens and must have been permanent residents for at least 5 continuous years. Or if they are under 65, they must be disabled.

Medicare Part A covers inpatient hospital stays or skilled nursing facilities.

Most enrollees in Part A do not pay a monthly premium however some of them pay $233.00/month (if they have between 30 and 39 quarters of having previously paid FICA taxes) or $423.00/month (if they have less than 30 quarters of having previously paid FICA taxes).

In addition to premiums, enrollees in this plan pay a $1068 deductible for hospital stays of 1-60 days and a $267 co-pay (per day) if the stay goes over 60 days.

Medicare Part B covers outpatient services such as physician services, x-rays and other lab tests, and durable medical equipment such as wheelchairs, walkers, and eyeglasses. Enrollees in Part B pays $96.40/month in premiums.

Other than premiums, enrollees pay a deductible of $135.00/year and are required to pay co-insurance of 20% (of the approved Medicare rates). The only exception to this is lab tests which are covered at 100%.

Medicare Part D, which began in January 2006, covers prescription drugs. There is no premium paid into Part D by its enrollees.

This is interesting. I did not realize that the people enrolled in Medicare had to pay so much. I honestly thought it was free. Shows how much I know. Wow!

Medicaid

This program is funded by both the federal and the states governments and is administered by the states.

People eligible for this program are low-income parents, children, seniors and people with disabilities however, not everyone that is poor qualifies for it.

Here are some links if you are interested in reading more about these programs:

Wiki article on the Social Security Act of 1965.
Wiki article on Medicare
Wiki article on Medicaid
Official website for Medicare and Medicaid