Final answer:
CMS policies on medical necessity are based on regulations in Title XVIII, section 1862(a) of the Social Security Act. These are critical for Medicare and Medicaid, programs established to provide healthcare to millions of Americans, with shared costs between federal and state governments.
Step-by-step explanation:
The CMS (Centers for Medicare & Medicaid Services) developed policies regarding medical necessity are derived from regulations found in Title XVIII, specifically section 1862(a) of the Social Security Act. This section establishes the foundation for what medical services are considered necessary and thus eligible for coverage under programs such as Medicare. Medicare, like Medicaid, is a federally-funded program that was created in 1965 to provide health-care coverage to approximately fifty million poor and disabled Americans, including more than a third who are over 65.
Congress has the authority to enact programs like Medicare, Medicaid, and the Children's Health Insurance Program, based on its constitutional power to 'make all Laws which shall be necessary and proper' for executing its mandated power 'to provide for the general Welfare.' These government-funded health care programs are designed to ensure that eligible individuals have access to necessary medical care, with costs typically shared between the federal government and the states.