After 49 Years, Medicare Stands on Stable Ground
— Trustees Report Shows Improvement, Credits Affordable Care Act —
New York, NY—The 2014 Medicare Trustees Report brings welcome news as Medicare celebrates 49 years of providing guaranteed health care benefits to our nation’s retirees. The trustees find that the Medicare Hospital Insurance (Part A) Trust Fund is solvent through 2030—four years longer than predicted last year, and thirteen years longer since passage of the Affordable Care Act (ACA).
According to the trustees, the HI Trust Fund will be able to pay on Medicare Part A inpatient claims in full for the next 16 years, and the Supplemental Medical Insurance (Part B and Part D) trust fund remains on firm financial footing, ensuring full payment for outpatient care and prescription drug needs.
Joe Baker, President of the Medicare Rights Center, said, “This year’s trustees report gives seniors and people disabilities all the more the reason to celebrate as the Medicare program marks its 49th year. In the near term, Medicare’s financial outlook is significantly improved. For policymakers this means two things: first, we have more time to test the delivery and payment reforms underway as part of the ACA, and second, there is no pressing need to cut benefits or hike costs for people with Medicare.”
In recent years, Medicare spending per beneficiary has grown at historically low rates, with zero growth in 2013 as reported by the trustees. The trustees acknowledge that many factors are contributing to the slow down in Medicare cost growth. Among these, the trustees give ample credit to provisions in the ACA, including realigned payments to private Medicare plans, initiatives to curb fraud and abuse, policies designed to discourage hospital readmissions, and innovations now being tested to enhance health care quality and improve care coordination.
Baker continued, “The trustees’ findings confirm what we already know to be true: time and again, the ACA is producing positive returns for people with Medicare. It is important to note that a strengthened financial outlook for Medicare means real-world savings for beneficiaries.”
According to the trustees, in 2015, the standard Medicare Part B premium will not increase in 2015 and thus will remain the same for the third consecutive year at $104.90 per month.
Baker concluded, “Preventing Part B premiums from increasing year-to-year is no small benefit for the more than 25 million older adults and people with disabilities living on annual incomes of $23,500 or less, representing half of the Medicare population. The trustees’ findings reinforce that there is no justification for cutting benefits or shifting costs to beneficiaries, particularly when so many are in no position to afford higher health care costs.”
Read our updated fact sheet: “Medicare: Strong and Built to Last.”