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APPENDIX A RACIAL PATTERNS WITHIN MEDICARE AND MEDICAID An examination of racial/ethnic patterns in the use of medical services within the Medicare and Medicaid programs is important for two reasons. First, since these programs involve massive amounts of federal funds, they are a major arena for concerns that may arise under Title VI of the Civil Rights Act. Secondly, since both ability to pay and source of payment may affect people's ability to obtain medical care, an examination of situations in which these factors do not vary will help illuminate the effect of racial and ethnic factors themselves. Thus, an examination of patterns of medical care within the Medicare and Medicaid programs will help demonstrate whether minority group members face disproportionate barriers in seeking medical care. Medicare is the federal health insurance for the aged and certain disabled persons. The eligibility requirements and benefit structure are the same throughout the country and apply without regard to income or assets. Medicare involves two types of insurance benefits. Part A covers inpatient hospital care, post-hospital extended care, and post-hospital home health care and is automatically provided to anyone eligible for Social Security payments. Part B covers physicians and related services and is financed in part by monthly premiums paid by beneficiaries. In fiscal year 1978, about 23 million persons (over 95 percent of the elderly) were eligible for Part A coverage, and most (98 percent of whites and 96 percent of nonwhites in 1976) of these were also covered under Part B.1 Racial Trends Within Medicare. In an analysis of 1968 Medicare data, Davis explored whether aged Medicare enrollees used benefits equally, regardless of race, income, or place of residence.2 She found expenditures per black enrollee under Medicare were smaller than expenditures per white enrollee. This difference was due to the fact that a smaller proportion of blacks than whites received benefits under the program. (Reimbursement amounts per person served, however, were essentially equal across racial groups.) The disadvantage of blacks was most severe for physician services and extended care facilities, and was most pronounced in the South. Davis's findings raised concerns about relative entitlements, by race, within the Medicare program in its early years. 161
