How is Part B of Medicare primarily funded?

Part B of Medicare is primarily funded through a combination of beneficiary premium payments and general revenues from the federal government. Beneficiaries are responsible for paying monthly premiums for Part B coverage, which covers outpatient care, preventive services, and some home health services. However, these premiums only cover about one-third of the total costs associated with Part B.

The remaining two-thirds of Part B funding comes from general revenues, which are collected from taxpayers and allocated to various federal programs, including Medicare. This structure reflects the shared responsibility of funding health care for seniors and certain disabled individuals, with the government supplementing the premium payments made by beneficiaries to ensure that comprehensive coverage is available.

Other options do not reflect the actual funding sources for Part B. Sole reliance on beneficiary premiums would not suffice to cover the costs and would leave many without coverage. Employee Medicare taxes fund the Medicare Trust Fund primarily for Part A, which covers inpatient hospital services, rather than Part B. Federal grants are not the primary mechanism for funding Part B, as it operates through the established payment structure mentioned above.