Medicare

Background

As part of the Social Security Amendments of 1965, the Medicare legislation sought to establish a national health insurance program for the elderly to complement the already-existing retirement, survivors, and disability insurance benefits. The enactment of Medicare in the United States followed several decades of debate over how to best meet the healthcare needs of the elderly in the United States. Prior to the 1960s, the U.S. government played a minimal role in the allocation of medical insurance. Medicare, modeled after the existing private health insurance market, was developed during President Lyndon B. Johnson's administration in the 1960s.

Coinciding with the popular ideology of the Great Society and the war on poverty, Medicare was designed as a non-means–tested program serving those considered to be “worthy” (i.e., those unable to work through no fault of their own).

As such, its configuration builds on the series of legislative efforts dealing with social insurance programs (e.g., Social Security) and entails sharing the costs across the population by raising funds through payroll withholdings contributed by both employers and employees.

Medicare Eligibility

Medicare, designed as a social insurance program, provides benefits to all eligible beneficiaries regardless of income or medical history. Eligibility is contingent upon age, U.S. citizenship, and contribution into the program through federal tax withholdings from employment. In general, individuals are eligible for Medicare if they (or their spouse) worked for at least 10 years and are U.S. citizens at least 65 years of age. Persons under the age of 65 receiving Social Security Disability Insurance (SSDI) are generally eligible for Medicare after a two-year waiting period.

Medicare was originally instituted to aid the elderly, officially defined as persons over 65 years old and eligible for Social Security benefits. In 1973, the program was expanded to include younger beneficiaries living with permanent disabilities. The following groups also became eligible for Medicare benefits: persons entitled to Social Security or Railroad disability cash benefits for at least two years, most persons with end-stage renal disease, and certain otherwise noncovered aged persons who elect to pay a premium for Medicare coverage.

The Medicare, Medicaid, and State Children's Health Insurance Program (SCHIP) Benefits Improvement and Protection Act of 2000 allowed persons with amyotrophic lateral sclerosis (Lou Gehrig's disease) to waive the two-year waiting period.

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