Projected insolvency date for Medicare now 7 years earlier
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Projected insolvency date for Medicare now 7 years earlier
Well, it looks like I'm going to have another thing to be mad at Bush for.
Here's an article from the AP. I've removed all assorted spins from the article except the official comment from the White House, and also snipped out some talk about Social Security. The full article can be found here.
Medicare will have to begin dipping into its trust fund this year to keep up with expenditures and will go broke by 2019 without changes in a program that is swelling because of rising health costs, trustees reported Tuesday.
...
The deteriorating financial picture for the health care program for older and disabled Americans is a result, in part, of the new Medicare prescription drug law that will swell costs by more than $500 billion over 10 years, according to the annual report by government trustees.
Provisions of the law that President Bush signed into law in December "raise serious doubt about the sustainability of Medicare under current financing arrangements," the trustees said.
The 2019 go-broke date for the Medicare trust fund, which is devoted primarily to paying beneficiaries' hospital bills, is seven years sooner than what the trustees projected last year.
The trustees' report is the first official estimates of the long-term costs of the new Medicare law in December. As they did last year, the trustees said that projected lower tax receipts devoted to the program and higher expenditures for inpatient hospital care also contributed to the growing financial problem.
White House spokesman Trent Duffy said the rising cost of health care — and not the prescription drug program — is causing Medicare costs to swell. "It's health care costs — over 70 percent," he said. "Not prescription drugs."
Government officials have been predicting for years that the retirement insurance and health care funds for the elderly — both financed through payroll taxes — will be pushed toward insolvency as more post-World War II baby boomers reach 65.
...
The trustees took the unusual step of estimating the shortfall for both Medicare and Social Security on an "infinite horizon," instead of limiting their long-term projections to 75 years. The new approach, which would put the combined shortfall at $72 trillion, takes into account "not only people who are participating today, but all future generations who will pay taxes and draw benefits," said a report co-authored last fall by Thomas Saving, a trustee who teaches economics at Texas A&M University.
Several analysts and Democratic congressional aides said the longer timeframe was meant to create a sense of crisis by Republicans who want to reduce the government's role in the programs in favor of private, individual investments.
Small differences in assumptions can produce major swings in projections, they said, pointing to the $139 billion difference over just 10 years in the estimated cost of the Medicare law between congressional budget analysts and Medicare's actuary.
The trustees' report is based on the estimates by Medicare actuary Richard Foster.
Republicans pressed for the overhaul of Medicare last year to give private insurers a much larger role in the program as a way, Bush and others said, to control long-term costs.
But the government's own projections are that private managed care plans will cost taxpayers more than traditional Medicare for the foreseeable future.
...
Last year, Medicare's insolvency date was moved up to 2026 from 2030.
...
The 2003 report also projected that Medicare will have to begin dipping into its trust fund in 2013 to keep up with expenditures.
There are several reasons why this makes me mad.
1. When the bill was being pushed for in Congress, what did those who opposed it say? They said it would bankrupt Medicare sooner.
2. Medicare is getting less tax money but being forced to spend more. Anti-Republican conspiracy theorists might say that they are trying to bankrupt Medicare. At the very least, it's irresponsible financial policy to cut funding to a program and make it spend more.
3. The statement from the White House is totally spin. How does some press spokesman know more about Medicare than its own board of trustees? He doesn't, and that number came straight out of his ass.
4. We all know that when Baby Boomers retire there will be a huge stress placed on the system. That has always been factored into these reports by the board of trustees. In the last two years alone, their projected insolvency date has moved up by a total of 11 years.
5. Republicans say they want private health plans to get in on the action. But the government's own non-partisan projections say that will cost taxpayers more than Medicare for the forseeable future.
Because of all of this, I fail to see ANY sort of logic in the passing of this prescription drug bill, let alone the desire to get private health plans in on the action. The prescription drug bill would cost taxpayers more under any normal economic policy which uses taxes to finance spending, and so will private health plans.
Did you know that the prescription drug industry in this country is the most profitable sector in the entire world? In most other countries, they have a single payer health care system and that payer is the government. So naturally prices for drugs are set by the government. There are also quick transitions to generic alternatives to new drugs.
There is no single payer system in place in our country nor do I think one should be implemented, but as a result the drug companies can charge whatever they want. US patents protect new drugs from being made into generic copies for 17 years, and of course I don't want to change patent law.
The drug companies argue that since they are limited in how much profit they can earn in other countries, and they have natural advantages in our country, they need to recoup their research and development costs here. If you're the most profitable sector of the entire world economy, I'd say you're doing a bit more than recouping your R&D costs.
So basically the Republicans said that this new prescription drug bill would benefit Medicare recipients, even though they knew full well that it did not provide the additional funding to Medicare that would make it work. There are very few old people who don't already have some way of paying for prescription drugs, and they don't necessarily need the government's help. What should have been done was to extend a prescription drug benefit to those people that can't pay for them, and to actually give Medicare the money to do so in order to keep from bankrupting itself.
There is also a huge need to get some kind of ceiling on prescription drug prices, because as the system stands right now the drug companies are committing highway robbery.
Here's an article from the AP. I've removed all assorted spins from the article except the official comment from the White House, and also snipped out some talk about Social Security. The full article can be found here.
Medicare will have to begin dipping into its trust fund this year to keep up with expenditures and will go broke by 2019 without changes in a program that is swelling because of rising health costs, trustees reported Tuesday.
...
The deteriorating financial picture for the health care program for older and disabled Americans is a result, in part, of the new Medicare prescription drug law that will swell costs by more than $500 billion over 10 years, according to the annual report by government trustees.
Provisions of the law that President Bush signed into law in December "raise serious doubt about the sustainability of Medicare under current financing arrangements," the trustees said.
The 2019 go-broke date for the Medicare trust fund, which is devoted primarily to paying beneficiaries' hospital bills, is seven years sooner than what the trustees projected last year.
The trustees' report is the first official estimates of the long-term costs of the new Medicare law in December. As they did last year, the trustees said that projected lower tax receipts devoted to the program and higher expenditures for inpatient hospital care also contributed to the growing financial problem.
White House spokesman Trent Duffy said the rising cost of health care — and not the prescription drug program — is causing Medicare costs to swell. "It's health care costs — over 70 percent," he said. "Not prescription drugs."
Government officials have been predicting for years that the retirement insurance and health care funds for the elderly — both financed through payroll taxes — will be pushed toward insolvency as more post-World War II baby boomers reach 65.
...
The trustees took the unusual step of estimating the shortfall for both Medicare and Social Security on an "infinite horizon," instead of limiting their long-term projections to 75 years. The new approach, which would put the combined shortfall at $72 trillion, takes into account "not only people who are participating today, but all future generations who will pay taxes and draw benefits," said a report co-authored last fall by Thomas Saving, a trustee who teaches economics at Texas A&M University.
Several analysts and Democratic congressional aides said the longer timeframe was meant to create a sense of crisis by Republicans who want to reduce the government's role in the programs in favor of private, individual investments.
Small differences in assumptions can produce major swings in projections, they said, pointing to the $139 billion difference over just 10 years in the estimated cost of the Medicare law between congressional budget analysts and Medicare's actuary.
The trustees' report is based on the estimates by Medicare actuary Richard Foster.
Republicans pressed for the overhaul of Medicare last year to give private insurers a much larger role in the program as a way, Bush and others said, to control long-term costs.
But the government's own projections are that private managed care plans will cost taxpayers more than traditional Medicare for the foreseeable future.
...
Last year, Medicare's insolvency date was moved up to 2026 from 2030.
...
The 2003 report also projected that Medicare will have to begin dipping into its trust fund in 2013 to keep up with expenditures.
There are several reasons why this makes me mad.
1. When the bill was being pushed for in Congress, what did those who opposed it say? They said it would bankrupt Medicare sooner.
2. Medicare is getting less tax money but being forced to spend more. Anti-Republican conspiracy theorists might say that they are trying to bankrupt Medicare. At the very least, it's irresponsible financial policy to cut funding to a program and make it spend more.
3. The statement from the White House is totally spin. How does some press spokesman know more about Medicare than its own board of trustees? He doesn't, and that number came straight out of his ass.
4. We all know that when Baby Boomers retire there will be a huge stress placed on the system. That has always been factored into these reports by the board of trustees. In the last two years alone, their projected insolvency date has moved up by a total of 11 years.
5. Republicans say they want private health plans to get in on the action. But the government's own non-partisan projections say that will cost taxpayers more than Medicare for the forseeable future.
Because of all of this, I fail to see ANY sort of logic in the passing of this prescription drug bill, let alone the desire to get private health plans in on the action. The prescription drug bill would cost taxpayers more under any normal economic policy which uses taxes to finance spending, and so will private health plans.
Did you know that the prescription drug industry in this country is the most profitable sector in the entire world? In most other countries, they have a single payer health care system and that payer is the government. So naturally prices for drugs are set by the government. There are also quick transitions to generic alternatives to new drugs.
There is no single payer system in place in our country nor do I think one should be implemented, but as a result the drug companies can charge whatever they want. US patents protect new drugs from being made into generic copies for 17 years, and of course I don't want to change patent law.
The drug companies argue that since they are limited in how much profit they can earn in other countries, and they have natural advantages in our country, they need to recoup their research and development costs here. If you're the most profitable sector of the entire world economy, I'd say you're doing a bit more than recouping your R&D costs.
So basically the Republicans said that this new prescription drug bill would benefit Medicare recipients, even though they knew full well that it did not provide the additional funding to Medicare that would make it work. There are very few old people who don't already have some way of paying for prescription drugs, and they don't necessarily need the government's help. What should have been done was to extend a prescription drug benefit to those people that can't pay for them, and to actually give Medicare the money to do so in order to keep from bankrupting itself.
There is also a huge need to get some kind of ceiling on prescription drug prices, because as the system stands right now the drug companies are committing highway robbery.
