Medicare
Medicare Summary
According to the Office of Management and Budget of the Executive Branch of the Federal Government, the expenditures for Medicare went from $391 billion in FY 2008 to $472 billion in FY 2012. By FY2013, these expenditures were $498 billion and constitute 14% of the Federal budget. As baby boomers retire over the next years, these expenditures will increase dramatically. For instance, by 2019, Medicare expenditures are projected to be $654 billion. This is a 31% increase in just 6 years.
Based upon the 2013 report to Congress from the Trustees of the Medicare Trust Funds (http://go.cms.gov/12ahZBn) Hospital Insurance Trust Fund will go broke and be unable to cover benefits after 2026. The Department of Health and Human Services further noted that “Hospital insurance expenditures have exceeded income annually since 2008 and are projected to continue doing so under current law thru 2014” . The Part B (physician and outpatient services generally) and Part D (Drug) programs are forced into balance by increases in premiums charged to beneficiaries and by increases in expenditures from the General Fund of the budget. Part B is projected to increase by 6.3% per year and Part D by 9.3% substantially in excess of the increase in GDP or tax receipts. In essence, the Part B and Part D programs will increase the deficit substantially or crowd out other important programs