Impact of Medicare on the Use of Medical Services by Disabled Beneficiaries, 1972-1974

The extension of Medicare coverage in 1973 to disabled persons receiving cash benefits under the Social Security Act provided an opportunity to examine the impact of health insurance coverage on utilization and expenses for Part B services. Data on medical services used both before and after coverage, collected through the Current Medicare Survey, were analyzed. Results indicate that access to care (as measured by the number of persons using services) increased slightly, while the rate of use did not. The large increase in the number of persons eligible for Medicare reflected the large increase in the number of cash beneficiaries. Significant increases also were found in the amount charged for medical services. The absence of large increases in access and service use may be attributed, in part, to the already existing source of third party payment available to disabled cash beneficiaries in 1972, before Medicare coverage.