Medicare Going Broke More Quickly

For those who need an even more grim reminder of the underlying actuarial problems in Medicare, the Medicare and Social Security Trustees annual report released today now projects that the Medicare HI trust fund will be exhausted in 2017,  not in 2019 as predicted last year. The evidence is clear that the recession’s impact on healthcare benefits may be even deeper and more dramatic than hoped.

This is now the fourth such report that has  projected a future 45 percent difference between projected outlays and Medicare dedicated financing revenues.  Perhaps most telling is the projection that shows Medicare will cost more than Social Security by 2028.

The annual report in past years was intended as a distant bell to signal indicators that were unfavorable, but as the margin between current funding and projections pushes ever closer, the report now becomes a testament to urgency. What used to be a statistical exercise now is a powerful political tool, which the Obama administration will perhaps rightly use as an unbiased impetus to gain concessions in the soon-boiling health policy debate.