Main fund for Medicare program to run out of money in 2030: trustees
A slowdown in healthcare spending has shored up the funding outlook for the federal program that pays elderly Americans' hospital bills, trustees of the program said on Wednesday.
The Medicare program's trust fund for hospital care will run out of money in 2030 the trustees said in a report. That was the same year as in their previous estimate, although the trustees said the program now appears on better footing over the longer term.
When the fund runs out of money, Washington would only be able to partially cover its obligations.
The trustees urged U.S. politicians to enact new laws to keep that from happening, though they said the funding gap over the longer run appears narrowed thanks to signs that healthcare costs would be lower in the future.
"Notwithstanding the assumption of a substantial slowdown of per capita health expenditure growth ... Medicare still faces a substantial financial shortfall," the trustees said in the report.
Trustees for the country's Social Security program repeated their warning that Washington would run out of the money needed to fully pay disability benefits by 2016.
Depletion of the Medicare and Social Security trust funds does not mean that all benefits would stop. At the current rate of payroll tax collections, Medicare would be able to pay about 86 percent of costs in 2030, declining to 80 percent by 2050.
Social Security would be able to pay about 81 percent of disability benefits starting in "late 2016," the Treasury Department said in a statement. In 2034, the Social Security program would only have money to cover about three quarters of the pensions that it pays.