POL 321 Lecture Notes - Lecture 14: Co-Insurance, Hearing Aid, Political Movement
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Published on 2 Jan 2020
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Lecture 14
Government Healthcare Programs
• Majority of people in the US get insurance from employer, but there are other sources
o Medicare ~17%
o Medicaid ~20%
o VA
o Uninsured 8-9%
• In 1950s, many people of working age & employed status have health insurance, but leaves
out the elderly & the low-income/poor (unemployed, work part-time, work minimum
wage)
o Political movement for policy solutions for these vulnerable people
• High rates charged by private market for elderly coverage
• 1965 Social Security Act Amendments—signed by President Johnson to create Medicare
& Medicaid
• Medicare—coverage for the elderly, administered & payed for entirely by the federal
government
o About 15% of total federal budget
o Funding comes from payroll taxes (~1/4) & rest from the general fund & premiums
o Premium is determined by income on a sliding scale
o 4 Parts: A, B, C, D
o Part A—hospital care, hospice, & home health
• If you (or spouse) pay payroll taxes 10 years, eligible as long as 65+
• No premiums, ~$1300 deductible
o Part B—physician care, outpatient, tests, equipment
• Has premiums ~$135-$460/month by income
• Required unless you have other coverage if 65+, or incur penalties
• Low deductible, then 20% coinsurance
o Part C—managed care plans
• Optionally choose to get traditional private coverage that the federal
government makes payments to
• Costs additional premium but tends to cover extra things like dental & optical
• About 1/3rd Medicare enrollees get it
o Part D—prescription drugs
• Voluntary
• Administered by private companies approved by the federal government
o Medicare doesn’t cover eyeglasses, hearing aids, or long-term care (like assisted
living facilities)
o May need to pay out of pocked, get extra coverage, or get Medicaid (if eligible) to
help with these other services
o Reimbursement is the actual cost of providing the service plus some overhead,
salaries, administrative costs
o Clear reimbursement rates set by federal government law
o Doctors aren't required to see/take/accept Medicare
• Get paid less so may choose not to
• Many still do though since higher degree of confidence that bill will be paid
• Medicaid—coverage for the poor, especially families & pregnant women