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World Health Systems Facts

Medicare Financing

August 26, 2019 Medicare

"The Medicare program has two separate trust funds—the Hospital Insurance (HI) Trust Fund, which finances Part A, and the Supplementary Medical Insurance (SMI) Trust Fund, which finances Parts B and D. (Part C payments are made in appropriate parts from both the HI and SMI Trust Funds.) Both funds are maintained by the Department of the Treasury and overseen by a Board of Trustees, which reports annually to Congress."Similar to Social Security, the HI portion of Medicare was designed to be self-supporting and is financed through dedicated sources of income. The primary source is payroll taxes paid by employees and…

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