Medicare

Medicare is a United States government health insurance program that covers nearly all people age 65 or older. It also covers certain people with kidney disease and people who have received Social Security disability benefits or Railroad Retirement Board disability benefits for at least two years. The Railroad Retirement Board is a federal agency that administers a pension system for railroad employees.

Medicare consists of two types of insurance-hospital insurance and medical insurance. Hospital insurance helps pay the cost of hospital care, certain skilled nursing facility care after leaving the hospital, and home health services. Medicare also has an optional hospice benefit that is available for terminally ill patients. Hospice is a type of home-centered health care for people dying of an incurable illness. Medicare hospital insurance is financed by a tax paid by workers and their employers and by self-employed people.

Medicare medical insurance helps pay for physicians' services and certain other costs not covered by hospital insurance. Medical insurance is financed by the federal government and by monthly payments from members. In 2003, Congress passed legislation to add prescription drug coverage to Medicare.

Eligible people can get Medicare coverage by signing up at a Social Security Administration office or, if appropriate, a Railroad Retirement Board office. Medicare beneficiaries normally must pay premiums and some of their own medical expenses. But for certain low-income people, a welfare program called Medicaid pays part or all of these premiums and expenses. Medicare is managed by the Health Care Financing Administration of the U.S. Department of Health and Human Services.

Critically reviewed by the Health Care Financing Administration