For more than 40 years, Medicare has served as a federal health insurance program for individuals age 65 and older and is a primary source of insurance for Americans over the age 65 who do not have employer-sponsored health coverage The program offers eligibility to this group of individuals regardless of their medical history or income and serves as an important source of health coverage.
Covering nearly 43 million Americans, the Medicare program includes: inpatient and outpatient hospital services, provision of nursing facilities, preventive services, home health visits, private managed care plans and recently, prescription drug benefits. The Medicare population consists of individuals who are of low-income (<150% Federal Poverty Level, FPL), suffer from 3 or more chronic illnesses, cognitive and mental disabilities, and are enrolled in nursing homes.
The structure of the Medicare program is organized into four parts: Part A (inpatient hospital services), Part B (outpatient and physician services), Part C (Medicare Advantage program), and Part D (new prescription drug benefit).
With an aging population increasing at precipitous rate, the Medicare program faces the challenge of financing healthcare for newly enrolled beneficiaries as well as overcoming programmatic obstacles that include: successful implementation of the Part D Drug Plan, establishing appropriate reimbursement payments, improving availability of disease management programs for individuals with chronic conditions and ensuring greater access to healthcare for individuals with low-income and disabilities. In specific, state policymakers must address the issue of “clawback” in the new Medicare Part D Program and its impact on the state fiscal budget as well as their ability to provide appropriate prescription drug benefits for the Medicare beneficiaries.
Source: The Kaiser Family Foundation. Medicare At A Glance. July 2006.
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