 Eli Ginzberg Published in print: 0000-00-00 This chapter examines the overall impact of Medicare in the U.S. medical care system. It first provides an overview of the passage of Medicare and then describes how Medicare expanded the financing of the nation's leading research-oriented academic health centers (AHCs). Medicare's reimbursement policies helped improve the financial position of AHCs. One of the most important of the new financing arrangements under Medicare was the payment that the federal government made to hospitals for the direct and indirect costs connected with the operation of residency and fellowship training programs.