The brief’s key findings are:
The headline from the 2018 Trustees Report was an earlier depletion date for the Hospital Insurance (HI) trust fund, suggesting Medicare faces growing trouble.
However, the trust fund reserves are small compared to HI expenditures, and the HI component only accounts for about a third of the Medicare system.
In fact, Medicare’s outlook is considerably better than it was a decade ago, even under projections that assume policymakers curb some recent cost controls.
Despite the improvement, Medicare does face financing challenges because it:
has to operate within the very expensive U.S. health care system;
requires beneficiaries to pay substantial out-of-pocket costs; and
has some serious gaps in insurance protection.