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Due to rising healthcare costs and the aging of the population, spending under the Medicare program will outpace its revenues, resulting in substantial cash deficits, according to the latest Trustees report. As a result, the Hospital Insurance (HI) Trust Fund, which finances Medicare Part A, will be depleted in 8 years, at which point payments to participating hospitals and other providers would be reduced.
Below are the key takeaways from today’s report:
Without reform, Medicare spending will continue to rise over the coming years — threatening the HI Trust Fund and placing immense pressure on the overall federal budget. Fortunately, there are many solutions available to put the program on sound financial footing. For example, policymakers could increase revenues dedicated to the program, reduce program expenditures, or some combination of both. Securing this trust fund would not only prevent payment cuts to beneficiaries, but also help relieve pressure on the nation’s unsustainable fiscal outlook.
Related: Social Security Faces Serious Financial Shortfalls, And Other Takeaways From The Trustees Report
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