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MEDICARE TRUSTEES 2020 Report – hospital fund runs out of money in 2026

The Medicare hospital insurance fund (Part A) runs out of money in 2026, according to the latest report from the Medicare Trustees. The April 2020 report by CMS discusses the state of each of the Medicare Trust funds – a $796 billion program for 61.2 million people in 2019. Medicare expenditures alone are estimated at 3.7% of gross domestic product (2019), same as last year. Part B (outpatient) and Part D (drug) have “sufficient financing” – i.e., they are in decent shape. However, the hospital trust fund is projected to be depleted by 2026 (the same as projected inĀ  the last two years). As a caveat, the picture could actually be worse in light of the COVID-19 pandemic. The Medicare Board of Trustees was unable to adjust the estimates accurately at this time for the effects of the new coronavirus. The Trustees noted that the real picture could be worse than projected. The 2021 report could be more dire, with less time to fix the fund. In 2019, the average total Medicare benefit per enrollee was $13,879, up 4.7% from the prior year. [Note June 15, 2021: The 2021 Medicare Trust fund report is already 2 1/2 months overdue, which we think is not a good sign. Read more.]

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