According to the Kaiser Family Foundation (2015), Medicare is financed primarily from three sources, including general revenue, payroll taxes, and beneficiary premiums. Each component of Medicare is mainly financed through a different source. Part A is predominantly financed through taxes paid by employees and employers (Facts, 2015). There is a 2.9% tax on earnings, and taxes account for 87% of Part A revenue. The taxes are deposited into the Hospital Insurance Trust Fund (Medicare, 2014). Additionally, the article (2015) states that employers and employees pay a payroll tax of 1.45% each, while higher-income taxpayers pay a higher payroll tax of 2.35% on earnings.
In comparison, Part B is funded by general revenue and premiums paid by beneficiaries. Medicare pays premiums for Part B on the behalf of beneficiaries who qualify for Medicaid based on their low incomes and assets (Medicare, 2014). Alternatively, beneficiaries with higher incomes pay a higher monthly premium based on their incomes (Medicare, 2014). According to data collected in 2014 by ...
... middle of paper ...
...lees with higher income pay an income-related monthly adjustment amount. This is in addition to the monthly premium that is charged by their Part D plan.
Medicare is an insurance program for people 65 and older, people with certain disabilities, and people with End-Stage Renal Disease or ALS. Medicare is financed from three sources: general revenue, payroll taxes, and beneficiary premiums. Each part of Medicare is predominately financed by a different source. Data from the report by Cubanski and colleagues shows that 41% of Medicare is financed through general revenue, 38% are from payroll taxes, and 13% from beneficiary premiums. Each component of Medicare provides various benefits, depending on eligibility and other requirements. Medicare is essentially a financial security for beneficiaries, as well as a vital aspect of health insurance to millions of Americans.
Need Writing Help?
Get feedback on grammar, clarity, concision and logic instantly.Check your paper »
- Introduction Nearly every aspect of the United States health care system is complex; Medicare is no exception. Discovering who is eligible for Medicare, how Medicare is paid for and what benefits are covered under which part is confusing at best. Medicare has four parts: Part A, Part B, Part C and Part D. Not all of these require premium payments and different services are covered under each part. Furthermore, the financing of Medicare is difficult to understand because it is funded by several different sources.... [tags: enrollment, age, policy]
1873 words (5.4 pages)
- ACA Medicaid reform: Five reforms The implementation of ACA sought to reform the current challenges. There are currently six options of reform a state can implement according to the ACA. Each option allows the states to expand opportunities, research, delivery and quality of care. To date nearly every state has adopted at least one provision introduced by ACA. Jackson (2012) states, the ACA required states to expand their Medicaid programs to all individuals under age 65 with incomes below 133 percent of the federal poverty level, or lose all federal Medicaid dollars.... [tags: Health care, Managed care, Health insurance]
957 words (2.7 pages)
- ... Historical trend Medicare on the historical and recent trends has been on the decline. According to The Henry J Kaiser Family Foundation (2015), the historical trend of Medicare between the years of 1969 and 2013 grew at an average annual rate of 7.5 percent which was slower than the 9.1 percent growth rate of private insurance spending per enrollee. In addition, The Henry J Kaiser Family Foundation (2015), also states that in the last five years, Medicare spending has decreased compared to the previous decade at an average 4.1 percent between the years of 2010 to 2014 with a rate of 4.1 percent, from 2000 to 2010 the average rate was documented at 9 percent.... [tags: Health care, Medicare]
1338 words (3.8 pages)
- In 1929 the United States experienced a stock market crash known as The Great Depression. This had been the biggest economic disaster in western society. Between 1930 and 1932, the unemployment rate increased from 3% to 25% leaving 13 million Americans unemployed. Those who were able to maintain employment saw a 40% decrease in income by the year 1932 (Szostak, 2003). In an effort to protect individuals who were old, disabled or unemployed, President Franklin Roosevelt implemented “social insurance.” Roosevelt sought to protect future generations from ending up impoverish.... [tags: Medicare, Health insurance, Social Security]
1031 words (2.9 pages)
- Health Care finance, insurance options, distribution of insurance, and how the different types of insurance plans operated in the United States is complex and complicated discussion. United States health care spending, in 2014, increased 5.3 percent which was a 2.9 % increase from 2013 to reach $3.0 trillion or $9,523/per person (CMS 2015). The fastest growth experienced in 2014 was mainly due to the major coverage expansion under the Affordable Care Act, specifically for Medicare and private health insurance (CMS 2015).... [tags: Health insurance, Health economics, Medicare]
1609 words (4.6 pages)
- According to a poll conducted by The Washington Post and the Kaiser Family Foundation, there are currently 2.6 million Americans who are shipped off to combat in Iraq or Afghanistan each year. Within the one-percent of the population of the United States that chooses to serve in the military, over half suffer or has suffered from mental health illnesses due to combat related trauma (Rajiv Chandrasekaren and Michael Du Cille). With this being said, the fight for adequate mental health services for those who have put their life on the line has become an issue highly recognized by military members past, present, and future as well as congressional adherents looking for change.... [tags: Mental health, Psychiatry, Health care]
1378 words (3.9 pages)
- Introduction With the passage of the Affordable Care Act , health coverage has seen the most notable change since the enactment of Medicaid and Medicare in 1965. Through its individual mandates, the ACA requires that most individuals have health insurance coverage or potentially pay a penalty as a result of not complying. Through its enactment, individuals are required to maintain minimum essential coverage for themselves and their children, although there are a number of individuals that will remain exempt from this mandate and the penalty.... [tags: Health care, Health insurance, Medicare]
1267 words (3.6 pages)
- ... Funds are collected from all health insurance issuers and third party administrators then the HHS distributes the payments based on need. The reinsurance payments are only given to individual market plans on the exchange that are subject to new market rules. The reinsurance payments are calculated based on medical cost data, which identify high-cost enrollees. An attachment point is the dollar threshold that eligible insurance plans must pass in order to receive reinsurance 2. The HHS sets attachment point figures and reinsurance caps.... [tags: Barack Obama, United States, Medicare, Insurance]
891 words (2.5 pages)
- Obamacare: A Dream. The Reality. The Patient Protection and Affordable Care Act (PPACA), referred to as the Affordable Care Act (ACA) and sometimes Obamacare, is a United States federal statute signed into law by President Barack Obama on March 23, 2010. The law mandates United States citizens to obtain health insurance coverage, and businesses of 50 or more full time employees to provide health insurance to their employees. Should you not be covered, or a business as outlined prior not provide health insurance coverage options, a penalty will be imposed.... [tags: Health insurance, Health care, Medicare, Medicaid]
2215 words (6.3 pages)
- Kaiser Permanente (KP) started from manufacturing healthcare for construction, shipyard, and steel mill workers in the late 1930s and 1940s. The healthcare plan was available to the public in October 1945. The ideology behind prepayment healthcare started during the Great Depression with a surgeon and a twelve hospital bed in California. Kaiser Permanente is an integrated managed care group, founded in 1945 by Henry J. Kaiser and physician Sidney Garfield. KP is made up of three distinct groups of body: the Kaiser Health Plan; Kaiser Hospitals; and Permanente Medical Groups.... [tags: Health care, Ethics, Kaiser Permanente]
1235 words (3.5 pages)