Importance: Medicare and Medicaid are the nation's 2 largest public health insurance programs, serving the elderly, those with disabilities, and mostly lower-income populations. The 2 programs are the focus of often deep partisan disagreement. Medicare and Medicaid payment policies influence the health care system and Medicare and Medicaid spending influences federal and state budgets. Debate about Medicare and Medicaid policy sometimes influences elections.
Objective: To review the roles of Medicare and Medicaid in the health system and the challenges the 2 programs face from the perspectives of the general public and beneficiaries, health care professionals and health care institutions, and policy makers.
Evidence: Analysis of publicly available data and private surveys of the public and beneficiaries.
Findings: Together, Medicare and Medicaid serve 111 million beneficiaries and account for $1 trillion in total spending, generating 43% of hospital revenue and representing 39% of national health spending. The median income for Medicare beneficiaries is $23,500 and the median income for Medicaid beneficiaries is $15,000. Future issues confronting both programs include whether they will remain open-ended entitlements, the degree to which the programs may be privatized, the scope of their cost-sharing structures for beneficiaries, and the roles the programs will play in payment and delivery reform.
Conclusions and relevance: As the number of beneficiaries and the amount of spending for both Medicare and Medicaid increase, these programs will remain a focus of national attention and policy debate. Beneficiaries, health care professionals, health care organizations, and policy makers often have different interests in Medicare and Medicaid, complicating efforts to make changes to these large programs.