The release of the annual Medicare trustees report in late April, containing as it did a vast array of very bad news, was immediately greeted with valid dire warnings of fiscal disaster. Little noticed, however, were three important bits of good news: the inevitability of imminent action; a simple key hidden in the report for understanding Medicare’s fiscal problem; and a proven bipartisan solution.
To be sure, the trustees report provided a wealth of bad news about the program’s finances. The key facts:
- Part A, the Hospital Insurance (HI) program, ran a cash deficit in 2011 of almost $28 billion, and the Medicare Trust Fund is projected to be insolvent in about 12 years.
- Medicare has an unfunded obligation of $42.7 trillion.