An Encouraging Report on Medicare Solvency

The trust fund that finances Medicare’s hospital insurance coverage will remain solvent until 2030, four years beyond what was projected in last year’s report, according the The Medicare Trustees. The improved outlook is due, in part, to cost controls implemented in the Affordable Care Act. Per capita spending is projected to continue to grow slower than the economy for the next several years. There was lower-than-expected spending in 2013 and lower projected utilization in the types of health care needed by Medicare patients. Medicare spending, per beneficiary, has grown quite slowly over the past few years and is projected to continue to grow slowly over the next several years. During the past four years, per capita Medicare spending growth has averaged 0.8% annually. That is a much slower growth rate than the average 3.1% annual increase in per capita GDP and national health expenditures. The report is available at:http://www.cms.hhs.gov/ReportsTrustFunds/downloads/tr2014.pdf