Medicare Part A is financed through:

• A. FICA tax on income earned by workers.
• B. General tax revenue only.
• C. Premiums paid by patients only.
• D. Employer contributions only.

Answer: (A)

Medicare Part A is funded mainly by the FICA payroll tax applied to wages. This money comes from both workers and their employers (and self-employed individuals pay the equivalent through SECA). It goes into the Hospital Insurance trust fund to cover inpatient hospital services and related care. General tax revenue funds other parts of Medicare, and standard Part A coverage doesn’t rely on patient premiums for most people. Premiums do apply only in specific cases for those who haven’t paid enough payroll taxes, but that isn’t the typical funding source.