Part B is Medical Insurance and covers physicians services, outpatient care, test, and supplies. (see Medicare Part B)

Part A is Hospital Insurance and covers cost associated with confinement in a hospital or skilled nursing facility. (see Medicare Part A)

Internal Revenue Code 125 allows an employer to implement an employee benefit plan which allows employees to se1ect the benefit programs they prefer.

The plan offers two or more options and the employee chooses the option most appropriate for him or her. Because of the "menu" of benefits available, the plan is referred to as a "Cafeteria Plan".