KHN Morning Briefing

Summaries of health policy coverage from major news organizations

Trustees Say Medicare Will Be Solvent Until 2024, Urge Fixes

News outlets report on the predictions offered by the Medicare trustees, and examine the assumptions behind them as well as the political landscape.  

Los Angeles Times: Trustees Warn Of Looming Insolvency For Social Security, Medicare
Medicare, which is expected to provide health insurance to more than 50 million elderly and disabled Americans this year, is expected to start operating in the red in its largest fund in 2024, according to the annual assessment by the trustees charged with overseeing the programs (Levey, 4/23).

Kaiser Health News: Trustees Issue Warnings On Medicare, But Make No Changes To Solvency Projections
Trustees of the Medicare program today forecast increased financial troubles as a result of an aging population and rising health care costs, increasing the visibility of an issue that is already proving divisive in the 2012 presidential and Congressional campaigns (Werber Serafini and Galewitz, 4/23).

The Associated Press: Social Security Heading For Insolvency Even Faster
There was no change in the year that Medicare's hospital insurance fund is projected to run out of money. It's still 2024. The program's trustees, however, said the pace of Medicare spending continues to accelerate. Congress enacted a 2 percent cut for Medicare last year, and that is the main reason the trust fund exhaustion date did not advance (Alonso-Zaldivar and Ohlemacher, 4/23).

Bloomberg: Medicare's Financial Condition Holds Pat After Debt Deal
The deal President Barack Obama made last year with Republicans to reduce the U.S. deficit may have stalled a worsening in the financial condition of Medicare. The debt-reduction legislation included cuts to Medicare payments that will be enacted in 2013. Those pending reductions are offsetting gloomier assumptions about the nation’s future economic performance (Wayne, 4/23).

The Washington Post: Social Security's Financial Forecast Gets Darker; Medicare's Outlook Unchanged
[In 2024] incoming revenue from Medicare taxes will be enough to cover 87 percent of annual expenses. That share will decline to about 67 percent by mid-century, then rise to 69 percent by 2085. Those figures are slightly worse than last year's projections (Aizenman, 4/23).

The Wall Street Journal: Stress Rises On Social Security
Social Security and Medicare, the government-run health plan for senior citizens, are together the largest U.S. public benefit programs and account for one-third of the federal budget. The programs' costs are projected to grow rapidly because of the aging U.S. population and, in Medicare's case, the rising cost of health care (Paletta, 4/23).

The New York Times: Social Security's Financial Health Worsens
One of the trustees, Kathleen Sebelius, the secretary of health and human services, said, "Medicare is in a much stronger position than it was a few years ago, thanks to the Affordable Care Act,” signed by President Obama in 2010" (Pear, 4/23).

USA Today: Report: Medicare, Social Security Outlooks Declining
[Treasury Secretary Tim] Geithner said the 2010 health care law would lower costs by changing how people pay for health care. Administration officials also said that, without the health care law, Medicare's trust fund would be exhausted in 2016 (Kennedy, 4/23).

Reuters: Without Reforms, U.S. Retirees To Face Dwindling Funds
[Charles] Blahous and fellow trustee Robert Reischauer said lawmakers should be aware that it will become increasingly difficult to "avoid adverse effects" on retirees or those close to retirement if legislative changes are delayed much longer (Younglai and Somerville, 4/23).

MedPage Today: Medicare Fund Forecast Bleak, But Stable
According to a senior government official, there were fewer inpatient admissions in 2011 than expected, and also admissions were overall less severe, and therefore less costly, than in previous years. The official said it wasn't clear what was driving the less-expensive hospital care, but he guessed that a greater number of simple procedures may have been performed in an outpatient setting (Walker, 4/23).

The Hill: Trustees Say Medicare, Social Security Funds Running Out Quickly
The Medicare fund only pays for certain benefits, primarily those for hospital stays. Services such as doctors’ visits and prescription drugs are paid for separately, and those funds don’t come from a dedicated account like the trust fund for hospital coverage (Baker, 4/23).

National Journal: No Change In Medicare Solvency Date, Trustees Say
Geithner made a case for implementing the president’s 2011 deficit reduction plan, which would reduce federal health spending by giving an independent Medicare financing board tougher spending goals, reducing drug reimbursements, and asking wealthy seniors to pay more for their care (McCarthy and Sanger-Katz, 4/23).

Reuters: Medicare Trustee Report Hangs On Uncertain Assumptions
With the fate of Medicare a hot-button election year issue for the program's 49 million beneficiaries, the report is likely to become fodder for Democrats and Republicans as they battle for control of the White House and Congress (Morgan, 4/23).

Politico: No Change In Medicare's Solvency Date, Report Says
The National Republican Congressional Committee, in a statement, said the status quo report merely confirms that the Democrats’ plan to “bankrupt Medicare” is moving as expected. White House press secretary Jay Carney said the report underscores the importance of a “balanced approach” to controlling deficits (Feder and Haberkorn, 4/23).

CQ HealthBeat: Medicare Report Renews Partisan Fighting Over The Program's Future
Democrats said the new numbers showed that without the health care law, the hospital insurance trust fund’s financial troubles would be lurking just around the corner in 2016 and prompting even more agitation among policy makers (Norman, 4/23).

The Wall Street Journal's Washington Wire: Why The Medicare Forecasts Are Particularly Cloudy
A word of warning from the government trustees issuing long-term forecasts for the Medicare fund that pays for hospital benefits: It’s really cloudy out there. "Projections of Medicare costs are highly uncertain, especially when looking out more than several decades," they say in their report of projections of Medicare costs (Radnofsky, 4/23).

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