By Robert B. Helms Â |Â AEI Online (May 2004)
The Medicare trustees gave a strong warning in their annual report that the program faces serious financial problems that will begin to affect the federal budget this year.
The recently released annual report on the financial condition of Medicare warned that the hospital insurance (HI) trust fund would run out of money in 2019. That was seven years sooner than they had predicted in last year's report. Did anyone notice?
Again this year the entire report and even this finding were greeted with a big yawn. As in past years, the skeptics tell us the Medicare trustees are crying wolf. They have been predicting disaster for years, but nothing bad ever happens. And besides, the skeptics argue, this is a rich country, so we will be able to fix the program if the need ever arises.
They insist we should expand Medicare spending by making the drug benefit more generous and extending Medicare eligibility to more people, secure in the knowledge that younger workers will always be there to pay the bills. These political pollyannas could not be more wrong.
This year's report, which contains new information about the future financial condition of the program and the effects of the new Medicare Modernization Act (MMA), deserves a more careful look than past reports have received.
This review will examine why the trustees have changed their tune and now give a stronger warning on Medicare's fate and the need for reform. But, will the trustees' report motivate policymakers to seek a solution? Are the trustees still too optimistic? Should their warning be even stronger?
by Marilyn Werber Serafini Saturday, May 2, 2009
The president has been vocal about Medicare's money problems, but he has made it clear he won't seek to overhaul the program this year.
Medicare may be insolvent by 2016 -- forcing the president to tackle the issue sooner than he would like.
From 2004 to 2009 -- see how quickly things slide downhill?
Does anyone really believe there IS a "cure?"