Retirement, Disability, Death, and Medicare Benefits

Old-Age, Survivors', and Disability Insurance (OASDI); Medicare hospital insurance; and Medicare Supplementary Medical Insurance (SMI) are separately financed segments of the social security program. The OASDI program provides benefits for the aged, for the disabled, and for survivors of deceased workers. The cash benefits for OASDI are financed by earmarked payroll taxes, as is the hospital insurance portion of Medicare, for the most part. The SMI part of Medicare, which applies to physicians' services, is financed in part by uniform monthly contributions from aged and disabled people enrolled in the program and in part by general federal revenues.

In 1996 some 124 million people contributed to social security funds and about 43 million people drew monthly social security cash benefits. The law specifies certain minimum and maximum monthly benefits. Cash benefits are annually indexed to the increase in the cost of living as it is gauged in the consumer price index.