Posted on September 16, 2010 15:12
Categories: Employer and Individual Insurance | Legislative and Regulatory Issues
Topics: Cost-effectiveness | Legislation (National) | Medicare | Prescription Drugs | Spending
On August 5, the U.S. Social Security Administration (SSA) released the 2010 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds. The report found that health reform will improve Medicare’s solvency, projecting that Medicare’s Hospital Insurance Trust Fund will remain solvent until 2029. The 2010 report estimates that the fund will remain solvent 12 years longer than predicted before the passage of health care reform. The report also estimates that, in 2011, Medicare trust fund revenue will exceed expenditures; however, that projection is predicated on the successful implementation of health reform and “assumed economic recovery.” The report states that Medicare still requires further reforms to attain long-term fiscal stability. Additionally, the report estimates that one-quarter of Medicare Part B beneficiaries will be subject to “unusually large” premium increases in 2011 while the remaining beneficiaries’ premium increases are capped because they are indexed to social security benefits.
From the report:
The Medicare program has two components. Hospital Insurance (HI), or Medicare Part A, helps pay for hospital, home health, skilled nursing facility, and hospice care for the aged and disabled. Supplementary Medical Insurance (SMI) consists of Medicare Part B and Part D. Part B helps pay for physician, outpatient hospital, home health, and other services for the aged and disabled who have voluntarily enrolled. Part D provides subsidized access to drug insurance coverage on a voluntary basis for all beneficiaries and premium and cost-sharing subsidies for low-income enrollees. Medicare also has a Part C, which serves as an alternative to traditional Part A and Part B coverage. Under this option, beneficiaries can choose to enroll in and receive care from private “Medicare Advantage” and certain other health insurance plans that contract with Medicare. The costs for such beneficiaries are generally paid on a prospective, capitated basis from the HI and SMI Part B trust fund accounts.
Full report: 2010 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds (PDF | 2.53 MB)
The Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Fund. (2010). 2010 annual report.
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