Medicare Part A Catastrophic Protection Act of 1987

Medicare Part A Catastrophic Protection Act of 1987 - Amends part A (Hospital Insurance) of title XVIII (Medicare) of the Social Security Act to require that an inpatient hospital deductible be paid only for the first period of continuous hospitalization in a calendar year. (Currently, such deductible must be paid for each "spell of illness" requiring inpatient hospital services.) Removes durational limitations on the coverage of inpatient hospital services, except with respect to inpatient psychiatric hospital services. Eliminates the coinsurance requirement for inpatient hospital services.

Sets the inpatient hospital deductible for 1987 at $520, requiring cost-of-living adjustments to such deductible for succeeding years. Establishes the monthly part A premium, required of individuals who wish to buy into the Hospital Insurance program, at the monthly actuarial value of part A services provided to beneficiaries age 65 and over. Imposes a coinsurance rate, equal to 20 percent of the average per diem cost of post-hospital extended care services, for the first seven days of an individual's receipt of such services in a calendar year.

Provides coverage for post-hospital extended care services for 150 days in each calendar year. (Currently, such coverage is limited to 100 days for each "spell of illness.") Creates an extension period of hospice care for terminally ill beneficiaries which is to follow the two 90-day periods and the subsequent 30-day period of hospice care coverage currently provided in an individual's lifetime. Reduces the deductible imposed under part A on the first three pints of blood furnished to an individual during a calendar year to the extent such blood is replaced or a blood deductible has been imposed on the individual under part B (Supplementary Medical Insurance) of the Medicare program within such year.

Amends the Internal Revenue Code to require the inclusion within an individual's gross income of: (1) 50 percent of the actuarial value of part A services received, unless the individual became eligible for such services by paying a part A premium; and (2) the actuarial value of part B benefits received. Provides for the transfer of additional revenues resulting from the taxation of the value of Medicare services to the Federal Hospital Insurance Trust Fund. Sets forth reporting requirements.