The Medicare Trustees’ just-released projection for the improved solvency of the Medicare Part A (Hospital Insurance) trust fund is encouraging news, but Congress must take pre-emptive action now. Absent Congressional action, the Trustees project that the Part A trust fund will become depleted in 2031, three years later than estimated in their previous report, at which time Medicare still could pay 89% percent of benefits.
We support President Biden’s plan to strengthen Medicare’s finances, as laid out in his FY 2024 budget. His plan would bring more revenue into the program, rather than cutting benefits as some Republicans have proposed. Building on the prescription drug pricing reforms in the Inflation Reduction Act, the President’s budget proposal would lower Medicare’s prescription drug costs — and some of those savings would be used to extend the solvency of the Part A trust fund.
No discussion of Medicare’s trust fund solvency would be complete without mention of Medicare Advantage (MA), which has been a drain on the program’s finances. Private MA insurers have been overbilling Medicare in order to maximize their own profits, including dishonest practices such as “upcoding” and wrongly denying patients’ claims and pre-authorizations. Here again the Biden administration is taking corrective action — updating CMS rules to hold MA plans accountable, reduce overpayments to insurance companies, and increase transparency, including those ubiquitous and misleading Medicare Advantage television ads.
“We urge Congress to support President Biden’s Medicare proposals to strengthen the program’s finances. These are common sense solutions that help, not hurt, seniors. As the Trustees report makes clear. It’s positive news that the Part A trust fund has an additional three years before it becomes depleted, but current and future seniors expect action to keep the trust fund solvent for the long-term.” – Max Richtman, President & CEO, National Committee to Preserve Social Security and Medicare
Beyond trust fund solvency, the Trustees reported that the standard Medicare Part B premium will rise next year to $174.80 per month – a $10 or six percent monthly increase. “Any increase is a burden to seniors living on fixed incomes, who too often must choose between paying monthly bills or filling prescriptions and getting proper health care. Seniors need relief from rising premiums and skyrocketing out-of-pocket health care costs,” said Richtman.
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