By signing up for Medicare, whether it be because you have reached the eligible age or because you or a member of your family has a specific disability or health problem, you are immediately making a move towards protecting you and your family as you grow older.
Medicare is a government-funded initiative in the United States, which provides families with protection against hefty medical bills in relation to both emergency and everyday procedures – whether they are anticipated or not. The fact is that we all need medical help and attention at some point in our later lives. Medicare exists to ease the burden of these needs and lessen the drain on your finances that every trip to the hospital and Doctor’s office can cause.
Unfortunately, though this paints a very pretty picture for those aged 65 and over, or those eligible in different respects, it doesn’t cover all the details involved. Medicare is an evolving system of care, with ever-changing benefits and clauses. If you’ve never used or interacted with Medicare before, getting a solid picture of Medicare’s benefits isn’t always easy. But this article is here to give you a very basic introduction to the system – and how it can protect you and your family.
What Is at the Core of Medicare?
By definition, Medicare is the federal health insurance program that caters to those aged 65 and over, those with debilitating disabilities, and those suffering from End-Stage Renal Disease. As a system, it is designed to reward those who have been paying the applicable taxes by presenting them with premium-free Part A healthcare coverage once they reach 65.
Part A refers to the most basic Hospital Insurance and will cover inpatient stays where the beneficiary has no choice but to remain in the hospital for treatment or medical attention. It also covers hospice benefits, rehabilitation, assisted living, and pain relief in accordance with any of the former services.
Medicare was launched in 1966 and has since grown stronger under the Social Security Administration’s leadership and then the Centers for Medicare and Medicaid Services. Said to cover around half of all healthcare expenses for those involved, the benefits of Medicare are clear. However, it is integral that those signing up to join Medicare also ask themselves how they plan to cover the rest of the medical bills and fees they are faced with – with many opting for additional private insurance or the more extensive plans offered as part of Medicare’s Premium offering. This is simple enough to range and can be applied for under your original sign up – it is simply worth noting if you are considering Medicare’s benefits.
How Does Medicare Work?
Upon answering the million-dollar question, ‘what is Medicare’, the follow-up question we get most regularly tends to be around funding. Consumers like to know how reliable a program is, particularly when – in so many cases – its promises can almost seem too good to be true.
Medicare is funded by a combination of avenues:
- Payroll tax
- Beneficiary premiums
- Surtaxes from beneficiaries
- US Treasury revenue