MEDICARE TRUSTEES 2023 Report – hospital fund runs out of money in 2031

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MEDICARE TRUSTEES 2023 Report – hospital fund runs out of money in 2031

The Medicare hospital insurance fund (Part A) runs out of money in 2031, according to the latest report from the Medicare Trustees. The March 2023 report by CMS discusses the state of each of the Medicare Trust funds – a $905 billion program for 65 million people in 2022. Medicare expenditures alone are estimated at 3.7% of gross domestic product (2022), down 0.1 point since last year. Part B (outpatient) and Part D (drug) have “adequate financing” – i.e., they are in decent shape. However, the hospital trust fund is projected to be depleted by 2031 (three years later than projected last year). This is the 6th consecutive year of a Medicare funding warning. Both the President and Congress have responsibilities to address the warning by working on legislation. The financial situation was improved over 2021, as utilization did not rebound from the 2021 pandemic year as much as expected. In addition, a faster-than-expected economic recovery brought in more payroll taxes to help fund Medicare. The Medicare Board of Trustees projects a surplus of income over expense for 2023 and 2024, then annual deficits eat into Medicare’s reserves. By 2031, the hospital fund gets depleted – just eight years away. In 2022, the average total Medicare benefit per enrollee was $14,908.