The 1.45 percent that the government deducts from your paycheck — and also from your employer — is placed in the HI Fund to cover Part A services. This payroll tax provides the bulk of the money that flows into the HI Fund; that money is in turn used to cover Part A expenses. There is NO general funds monies.
Part B, which covers doctor appointments, is run by a separate trust fund, called the Supplemental Medical Insurance Trust Fund (SMI Fund). Enrollee premiums and funds from the general budget supply the SMI Fund, which then pays for Part B services.
The SMI Fund’s premiums and federal tax revenues are to be adjusted annually to cover the cost of Part B benefits; therefore, the fund cannot be overdrawn. Payments into the HI Fund, by contrast, are based on the number of workers paying into the system and are not adjusted each year, so the fund can become insolvent. HI Fund trustees meet annually to predict the fund’s solvency.
But while SMI can not be overdrawn, the Congress can – if it wishes – not force an increase in Part B (or Part D) costs paid by the Medicare beneficiary by paying for some of those costs
From the above we see that in 2010 the Congress voted to fund Part B with $163.5 Billion and to fund Part D with $51.1 billion out of costs of $212.9 billion for Part B and $62.0 billion for part D.
If the point is that Congress votes funds into the Medicare Part B & D – but not Hospital (A) system from General Funds that is true.
And indeed transfers from the general fund are an important source of financing for the SMI trust fund and are currently 1.5 percent of GDP and would increase to an estimated 3.0 percent in 2085 if we refuse to go to single payer with the Maryland Medicare waiver that forces all to accept the same price for a given service.