New Data Tacks Four More Years Onto Medicare Fund Lifespan

August 12, 2014

This year’s annual report of the Trustees for Medicare and Social Security revealed that the Medicare trust fund will not run out until 2030 — four years later than last year’s estimate.

The extension was attributed, among other things, to reduced hospital admissions and to Part D payments declining 4% from 2013 estimates due to the use of generics.

In an article on the report in USA Today, Bryce Williams, managing director of Towers Watson’s Exchange Solutions, offered the opinion that future savings could be in store beyond what is being projected, considering that the ACA now covers many people who were previously uninsured. This could result in more people reaching the Medicare eligibility age of 65 without a lifetime of chronic health issues going untreated or unmanaged, putting less strain on Medicare coffers.

Said Williams, “[The ACA is] a stealth benefit that’s going to further extend the life of Medicare, perhaps substantially, without having to round up new funding.”

Keep an eye on the headlines for more Medicare cost-saving measures, such as changing the way doctors are paid and the creation and use of more quality metrics to improve care and weed out excessive fees.

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