It’s Official: Medicare’s Finances Shadowed by Uncertainty
J.D. Foster /
If you do a quick read of the Medicare Trustees Report, it would seem that Medicare’s finances have dramatically improved since last year. The 2010 report shows that Medicare has a $30.8 trillion shortfall (net present value terms of excess costs over revenues over the 75-year time horizon). Last year it was $38 trillion. Big improvement, right? Not so fast.
Over the past six years, Congresses have twice passed—and two Presidents have signed—major legislation affecting Medicare. President Bush signed legislation creating a new drug benefit that provided an important modernization for the program yet also significantly worsened Medicare’s finances. President Obama signed Obamacare into law, which improved Medicare’s finances only if one assumes that the difficult programmatic changes Obamacare requires will take effect.
As Medicare Chief Actuary Rick Foster clearly indicates, however, that those assumptions are neither reasonable nor realistic. What we are left with then is a report containing projections the Actuary suggests are “poor indicators” of Medicare’s likely finances. In other words, Medicare has the same poor fiscal condition it had last year, but Obamacare has made it harder to project and understand.
Trustees Report Delayed, Devalued by Obamacare (more…)