DemDaily: What is Medicare and Medicaid?

August 8, 2019

Last week marked the 54th anniversary of Medicare and Medicaid, the two government-run, social insurance programs that provide health care to the most vulnerable of our citizens - the elderly, poor and disabled.

For over 50 years Medicare and Medicaid have been a critical part of economic security for Americans.

As the administration, Congress and presidential candidates continue to debate the best form of healthcare for our country, it is important to understand the history and status of the current system.

Lyndon Johnson signed the Social Security Act of 1965, creating Medicare & Medicaid


Medicaid and Medicare were a part of President Lyndon B. Johnson's Great Society domestic program, which launched in 1964 and focused on elimination of poverty and racial injustice.

On July 30, 1965, Johnson signed The Social Security Act of 1965, which introduced Medicaid and Medicare into law and, for the first time, made health care available to millions of older and lower-income Americans.

Medicare is a federal program that provides health coverage for those 65
or older, or who have a severe disability or certain illnesses, regardless of income.
Medicaid is a state and federal program that provides health coverage for low-income families,
the disabled, those with long-term care needs, and pregnant women, regardless of age.

How It Works
Medicare is a single-payer, national social health care program administered by the federal government and 30-50 contracted private US insurance companies.

Image: RetireeNews

It is funded by general revenue and a payroll tax, premiums and surtaxes from beneficiaries who pay into the system. On average, Medicare covers about half of the health care charges for those enrolled.

Today Medicare provides health insurance to approximately 60 million people 65 or older, disabled and youth with illnesses.

Medicaid is a means-tested social health care program that is jointly funded by federal and state governments, and managed by the states. States are not required to participate in the program but all have since 1982.

Each state administers its own program while the federal Centers for Medicare and Medicaid Services (CMS) monitors the state-run programs and establishes requirements for service delivery, quality, funding, and eligibility standards.

It is the largest source of funded medical and health-related services for US citizens and legal permanent residents, providing free health insurance to more than 75 million low-income and disabled people.

Under President Barack Obama's Affordable Care Act, which was signed into law in March of 2010, Medicaid was expanded to include more preventative services and lower drug costs.

The ACA's major provisions came into force in 2014, and by 2016, an estimated 24 million additional were covered by insurance, in part due to the expansion of Medicaid eligibility.

Since President Trump took office, however, the GOP have tried repeatedly to repeal the ACA, otherwise known as "Obamacare."

According to the Congressional Budget Office, Trump's original 2017 "repeal and replace" healthcare reform legislation, the American Health Care Act, would have gutted Medicaid with roughly $880 billion in cuts.

While Republican attempts to dismantle Obamacare have failed, we know the fight is not over.

"Democrats believe health care is a right for all, not a privilege for a wealthy few. That's why President Obama strengthened Medicaid and Medicare, and expanded coverage through the Affordable Care Act. And that's why the next Democratic president will continue to stand up for the health care every American deserves."
-- DNC Chair Tom Perez on the Anniversary of Medicaid and Medicare

Protect your healthcare. Make your voice heard at the ballotbox!

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Kimberly Scott

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Sources: CBO, Centers for Medicaid and Medicare Services, NPR, Wiki 

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