Medicare Solvent 2 Years Longer Than Expected: Report
FRIDAY, May 31 (HealthDay News) -- The trust fund that finances Medicare's hospital insurance coverage will remain solvent until 2026, two years longer than had been predicted previously, according to a new report from the Medicare Trustees.
According to the government-appointed experts, cost controls implemented under the Affordable Care Act have slowed Medicare spending. This trend is expected to continue, the Trustees said, and Medicare spending will grow at a slower pace than the U.S. economy for the next several years.
"The Medicare Hospital Insurance trust fund is projected to be solvent for longer, which is good news for beneficiaries," Marilyn Tavenner, administrator of the U.S. Centers for Medicare & Medicaid Services (CMS), said in a news release.
From 2010 to 2012, Medicare spending per beneficiary grew at 1.7 percent annually. According to the report, this is slower growth than the average rate of growth in the Consumer Price Index, and much more slowly than the per capita rate of growth in the economy.
Both taxpayers and beneficiaries will benefit from this slower growth, the report said.
The Trustees also noted that, according to preliminary estimates, the Part B Medicare premium will remain unchanged in 2014.
Lower projected Medicare Advantage program costs also played a role in the CMS's updated expectations for longer Medicare solvency. The report found that certain provisions of the Affordable Care Act would help reduce spending in this program by more than previous estimates. However, the Medicare Trustees believe that these lower spending projections may be partially offset by reductions in tax revenue.
In 2012, Medicare covered 50.7 million Americans. Roughly 27 percent of these beneficiaries enrolled in Part C private health plans that contract with Medicare to deliver Part A and Part B health services. Total expenditures in 2012 were $574.2 billion, compared to $536.9 billion in total income, the report found.
The Medicare Trustees include Treasury Secretary and Managing Trustee Jacob Lew, Health and Human Services Secretary Kathleen Sebelius, Acting Labor Secretary Seth Harris, and Acting Social Security Commissioner Carolyn Colvin. The President also appoints two more Trustees who are public representatives. These two members must receive Senate confirmation. Charles Blahous III and Robert Reischauer began serving on Sept. 17, 2010. CMS Administrator Tavenner serves as Secretary of the Board.
The report was published on the Centers for Medicare & Medicaid Services website.
The U.S. National Library of Medicine has more about Medicare.
SOURCE: U.S. Centers for Medicare & Medicaid Services, news release, May 31, 2013