Medicare Part A Case Study

Today, health care is drastically different than it was in 1965 when Lyndon Johnson signed Medicare and Medicaid into law. Since 1965, the government has allotted billions of dollars to these programs each year. This large amount of funding has led to better health care, but also the need for constant reevaluation (“Medicare,” Bioethics). Essentially, the goals of Medicare and Medicaid are to lessen barriers that U.S. citizens in poverty or old age face in regards to health care. Since their creation, Medicare and Medicaid have significantly increased the quality of health care that citizens receive in America today (Leonard). The establishment of Medicare and Medicaid in 1965 has revolutionized the liability of the federal government to

Medicare has four fundamental components that are called Parts A, B, C, and D. Medicare Part A covers necessary medical treatments that are performed in a hospital, short stays in nursing homes for rehabilitation, and hospice. Part A receives funding through employers and workers who pay social security taxes. Medicare Part B covers outpatient services that are not covered under Part A such as X-rays and chemotherapy. Medicare Part C is also known as Medicare Advantage, and it offers more benefits and lower costs than Parts A and B through private insurance companies. Medicare Part D covers prescription drugs and has been an option since the Medicare Modernization Act of 2003 that went into effect in 2006. Both Medicare Parts B and D are supplementary programs that are options to citizens. These beneficiaries pay a monthly premium and meet a deductible. In the past fifty years, Medicare has undergone some changes, but not to the extent that Medicaid has been changed (“Medicare,” Gale

national debt is growing exponentially is health care spending, mostly Medicare. The spending problems with Medicaid are easily fixable, because it is relatively easier to take away benefits from citizens in poverty than elderly citizens who possess a great deal of political power. The National Bureau of Economic Research stated, "Medicare has led to net transfers from the poor to the wealthy, as a result of relatively regressive financing mechanisms and the higher expenditures and longer survival times of wealthier beneficiaries. Even with recent financing reforms, net transfers to the wealthy are likely to continue for at least several more decades." In 2010, the Congressional Budget Office stated, "The single greatest threat to budget stability is the growth of federal spending on health care--pushed up both by increases in the number of beneficiaries of Medicare and Medicaid and by growth in spending per beneficiary that outstrips growth in per capita GDP. For the nation's fiscal situation to be sustainable in future decades, growth in such spending will have to be reduced relative to its historical trend and to the CBO's projected path. Today, outlays for Medicaid and Medicare combined equal about 5.5 percent of GDP. Under current law, spending for those two programs is expected to keep growing faster than the economy, reaching 6.6 percent of GDP by 2020 and potentially reaching 10 percent by 2035." Currently, Medicare is bankrupting