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Kaiser Family Foundation: 7 things to know about Medicare & its financial future


In its latest brief, Kaiser Family Foundation delves into how the Medicare program will fare in years to come.

Here are seven things to know:

1. Current estimates say Medicare will have ample funds to pay for hospital insurance benefits in full until 2028. Once those funds run out, the program will still cover 78 percent of costs covered under Part A via payroll tax revenues.

2. Medicare per capita spending continues to rise as the aging population is set to double from 40 million people in 2010 to 84 million people in 2050. Additionally, the number of people ages 80 and older will increase to 31 million people by 2050. As the population rises, Medicare per capita spending follows suit.

3. Medicare total and per capita spending growth rate has slowed since the ACA implemented various provisions aimed at reducing Medicare payments to providers and Medicare Advantage plans. Between 2000 and 2010, the Medicare spending growth rate decreased 9 percent. The rate then fell to 4.4 percent between 2010 and 2015.   

4. Between 2015 and 2025, the average annual growth in total Medicare spending is set to increase 7.1 percent, which is faster than the 4.4 percent average growth rate between 2010 and 2015.

5. A Congressional Budget Office report found fully repealing the ACA would add $802 billion to Medicare spending over the next decade.

6. Last year, Medicare constituted 15 percent of the federal budget. Net Medicare spending in 2016 totaled $588 billion. Between 2017 and 2027, KFF found net Medicare spending will increase from $592 billion to $1.2 trillion.

7. For Medicare Part D,  per capita spending growth is slated to be 5.8 percent between 2015 and 2025. Comparatively, spending for Part A is set to increase 3.2 percent in the aforementioned time frame and 4.6 percent for Part B.

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