A flat percentage tax collected on salaries and wages. A payroll tax of 7.65 percent on both employers and employees finances Social Security cash benefits and Medicare Part A hospital services. Of that 7.65 percent, 1.45 percent each, or a total of 2.9 percent of payroll with both employer and employee contributions, is allocated for Medicare. Funding of the Affordable Care Act (ACA) will come in part from higher Medicare payroll taxes on families making more than $250,000, starting in 2013.