A Bleak Future for Medicare Without Real Reform

If you are having trouble viewing this message, click here to view it online

A Bleak Future for Medicare Without Real Reform On September 8, 2011—well after the enactment of Obamacare—President Obama told Congress: “Millions of Americans rely on Medicare in their retirement. And millions more will do so in the future.… But with an aging population and rising health care costs, we are spending too fast to sustain the program. And if we don’t gradually reform the system while protecting current seniors, it won’t be there when future retirees need it.” The just released 2012 Medicare Trustees report reinforces the need for serious reform. But seniors and taxpayers alike should keep three things in mind: The short-term outlook of the Hospital Insurance (HI) Trust Fund says nothing about the long-term financial challenge posed by the Medicare program. HI Trust fund insolvency, focused only on hospital payments, is only one marker of Medicare’s fiscal health. The central fiscal challenge facing Medicare is not the HI Trust Fund; it is the dramatic growth in Medicare spending and the accumulation of massive debt. The President’s Medicare agenda will not solve Medicare’s central problems. While Obamacare will impose record-breaking payment reductions on providers, yielding $575 billion in savings in the initial 10 years of the law, this blunt strategy guarantees either access problems for seniors or failure to control costs. Expanding real competition is the only sound solution to Medicare’s deepening problems. Injecting intense competition into the financing and delivery of care, based on the experience of both programs, means that Medicare will have a better future: expanding access to plans, providers, and benefits while controlling costs. In the Heritage fiscal reform proposal Saving the American Dream, the Medicare premium support program would both enhance the solvency of the Medicare program and achieve a balanced budget in 10 years, maintaining that balance indefinitely. In contrast, the President’s proposed budget would never get to balance, and the Medicare program would deteriorate. Read the full post on The Foundry >> Regrets on the Left: Democrats Second-Guessing Obamacare Comparative Effectiveness Research Under Obamacare: A Slippery Slope to Health Care Rationing Critics Are Wrong: Conservatives Have a Plan for Health Reform Medicare Trustees to America: A Bleak Future Without Real Reform Saving the American Dream: The Heritage Plan to Reform Health Care   $65 Billion IN EMPLOYER MANDATE PENALTIES BY 2019 Obamacare is "bending the cost curve" up, not down. Learn More >>     About The Heritage Foundation Founded in 1973, The Heritage Foundation is a research and educational institute — a think tank — whose mission is to formulate and promote conservative public policies based on the principles of free enterprise, limited government, individual freedom, traditional American values, and a strong national defense. The Heritage Foundation | 214 Massachusetts Ave NE, Washington, DC 20002 | 202.546.4400 | heritage.org