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Medicare trustees brief Congress on program's financial challenges

June 20, 2013

The House Ways and Means Health Subcommittee today held a hearing on the Medicare Board of Trustees’ 2013 report. Released last month, the report estimated that the program's Hospital Insurance trust fund will remain solvent until 2026, two years later than projected last year, in part due to lower actual and projected spending for Part A services. Testifying at the hearing were Charles Blahous and Robert Reischauer, public trustees for the Medicare HI and Supplementary Medical Insurance trust funds. Reischauer said that despite the extended solvency projection and slower growth in per beneficiary spending in recent years, “the fundamental financial challenge facing the program and the imperative for further cost restraint and reform remain largely unchanged.” Blahous said that under current projections, “legislation will be needed to prevent a financing shortfall in Medicare HI and to address rising budgetary pressures arising from Medicare SMI. The sooner such legislation is enacted, the more gradual can be its effects and the greater the potential for long-term savings.”