What Is Medicare and Medicaid

What Is Medicare and Medicaid

In the U.S, health insurance is mostly in the hands of the private sector; however there are two federal government health insurance programs known as Medicare and Medicaid. These two programs are supported by the U.S federal government.

Medicare is a health care program by the U.S federal government for people older than 65 and those with certain disabilities for example younger people and people with End Stage Renal Disease (permanent kidney failure requiring dialysis or a transplant). Medicare provides for acute hospital care, physician services, brief stays in skilled nursing facilities and shot-term skilled home care related to a medical problem. Medicare coverage is determine not by a specific diagnoses, but by the nature of services required by the patients. Medicare coverage is restricted to medical care only. It does no include the cost of prescription drugs, custodial care at home or in nursing homes. Prescription drug coverage was added in 2003, but will only take effect in the year 2006.

Medicare was established along with Medicaid in 1965 by the Social Security Act. It was the responsibility of the Social Security Administration. The SSA was an agency of the Department of Health, Education and Welfare (HEW). In 1977, the Health Care Financing Administration (HCFA) was created under HEW to more effectively co-ordinate Medicare and Medicaid. In 1980, HEW was divided in to the Department of Education and the Department of Health and Human Services (HHS). In 2001, the HCFA was renamed the Centers for Medicare and Medicaid Services (CMS).

In most places in the country, people who have Medicare have a choice between a managed care plan and an indemnity plan. People can switch or interchange their plans for any reason, but they must officially inform their change of plan to the local Social Security Office. It can take up to 30 days for this change to come into effect. Medicare has two parts: Part A (Hospital Insurance), and Part B (Medicare Insurance). Medical insurance helps cover doctors'' services, outpatient hospital care, and some other medical services that Part A does not cover. However, you have to pay a premium for Part B.

In 2003, over 40 million Americans had health insurance coverage under Medicare. It uses the Resource-Based Relative Value Scale (RBRVS) to determine how much each doctor should earn.

Started last year, Medicare-approved drug discount cards are now available for savings on prescription drugs. This card offers a discount on the full retail price of prescription medications. Savings from these cards are estimated to be between 10-25% on many drugs. These voluntary cards are on offer until December 31, 2005, when this program ends. If your income is no more than $12,569 as a single person, or no more than $16,862 for a married couple, you can qualify for a $600 credit to help pay for your prescription drugs.

Medicaid is a joint federal state program that covers health services for some low income people, especially women and children and disabled people. The coverage and eligibility criteria vary from state to state. Medicaid is the primary financier of nursing home care in the country. Additionally, many states offer some level of home and community-based care services for Medicaid-entitled individuals. Such additional services are not mandated by Federal law but are an option of the state.

The Medicaid program was established along with the Medicare program in 1965 and provides health insurance for the poor. It is administered by the Center for Medicare and Medicaid Services (CMS) in the United States Department of Health and Human Services. It’s Children''s Health Insurance Program (CHIP) was setup in 1997. This program is similar to Medicaid, and aims to expand health insurance to children whose families earn more money to be able to qualify for Medicaid, but not enough to buy their own private health insurance.

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