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The program was placed into effect in 1965 under Title XVIII of the Social Security Act to make health insurance available to people age 65 or older, regardless of their medical history or their income. Before 1965, only half of the older Americans had any health insurance due to them having to live on less income, and health insurance cost so much more because of their age.

Today, Medicare covers over 50 million Americans, both those of ages 65 and older and younger people with qualifying disabilities. Medicare covers about half of the actual medical costs that enrollees incur, with the remainder of the expenses coming out of the beneficiaries pocket, the providers accepting the reduced amounts, or the beneficiaries having supplemental coverage, such as Medicare Supplements, or Medicare Advantage Plans. Able Medicare puts it best at this page:

Many of those that are about to become eligible for Medicare have some sort of HMO that they are apart of that they’d like to remain within after enrolling into Medicare. Two-Three month before you become eligible for Medicare, have your HMO start the paperwork for signing you up (to Medicare) and switching you over to their Medicare coverage

Since the time that Medicare was put into place, the life spans of our senior citizens have increased, and the advances of modern medicine have increased in cost. The benefits of living longer also increase the need for more care for a longer period of time. This fact has placed the burden of funding Medicare squarely upon younger wage earners. When Medicare began, the cost for Part B, which pays for the doctor, was only $3.00 per month. Now, that same cost is $104.00 per month.

While Medicare is currently financially intact, there is concern that it could be in trouble in future years, due to rising costs and inflation. A very high proportion of Medicare beneficiaries through erollment have at least on chronic or serious medical condition, and almost half of them have three or more of the same types of conditions. Roughly 47% of Medicare recipients have some kind of limitation on their activity. Two thirds of Medicare recipients will require some form of long-term care during their lifetime.

While there are no easy answers, our medical community continues to provide some of the best care in the world, and the financial aspects of medical care for our elderly population continues to be worked out via Medicare and other solutions.