Is Medicare Pay As You Go? 
Medicare part A which covers medical expenses resulting from hospital services is financed by payroll taxes on workers in employment covered by OASDI -LRB- Old-Age , Survivors , And Disability Insurance -RRB- on a pay as you go basis . Medicare part B which covers partial reimbursement for the cost of physician services , diagnostic tests , ambulance services , prosthetic devices , physical therapy , medical equipment , and home health services is funded primarily through the premiums of those enrolled and is not `` pay as you go '' . 