The American Academy of Actuaries has announced the fact that the Medicare hospital is facing important financial problems with its insurance trust fund. The situation seems to be much worse than it was initially suggested by the grim official projections.
The conclusion regarding the Medicare trust fund situation drawn by the American Academy of Actuaries has been presented in the Medicare issue brief, which came as response to the Medicare trustees’ report.
Earlier Medicare reports contain comments in which the trustees themselves talk about the fact that the Medicare trust fund financial problems are understated by the official numbers. The trustees have suggested, long before the American Academy of Actuaries report, that the hospital is facing much more severe problems than the official think. As result of the concerns coming from the Medicare trustees, a team of technical advisors established a meeting in January 2011; they talked about the economic assumptions, as well as about the economic assumptions, but methods used in order to create the trust fund projections have also been a discussion subject.
The official projections belonging to trustees now say that the Medicare hospital trust fund will become inexistent in 2024. In fact, it is the same prediction that the trustees have made more than a year ago, according to the American Academy of Actuaries.
An alternative scenario has been developed by the Office of the Actuary at the request of the trustees; the Office of the Actuary represents an arm of the American Health and Human services department and has developed a scenario which is completely different from the one belonging to the trustees. The difference stands in the fact that the alternative scenario implies the assumption that the Medicare hospital would take advantage of reimbursement cuts year after year for a long period of time. The Office of the Actuary believes that a slowing will be felt in the reimbursement starting with 2020.
Projections belonging to the office suggest the fact that the hospital insurance’s deficit rises at 1.35% of the taxable payroll.
The American Academy of Actuaries says that the Medicate steering committee will ask the Congress to support the sustainability of the program.
The American Academy of Actuaries also says that the implementations will be more effective if the corrective measures are being enacted as soon as possible. Not acting now means being more drastic in the near future.
