Dive Brief:
- Medicare's hospital trust fund will continue to cover all obligations until 2030, when it would pay 86% of costs, according to the Social Security and Medicare board of trustees' annual report.
- Although there are 10,000 new Medicare beneficiaries every day as boomers hit age 65, so far this hasn't over whelmed the system because in part, boomers are healthier than previous generations of Medicare enrollees.
- Trustees are still cautious. "Growth in per-Medicare enrollee costs continues to be historically low even as the economy continues to rebound," CMS administrator Andy Slavitt said. "While this is good news, we cannot be complacent."
Dive Insight:
One of the areas of concern are sky-rocketing drug costs. The report said there was a 10.9% increase in Part D drug coverage costs in 2014, mostly due to new, expensive specialty drugs.
"We call for all stakeholders, including drugmakers to come to the table and identify new ways to reward innovation without bankrupting our healthcare system," said John Rother, president of the National Coalition on Health Care and leader of the Campaign for Sustainable Rx Pricing, in a statement.
Several other initiatives are working to keep Medicare costs down via payment models for quality care. However, the report did point out that Social Security disability payments would have to be trimmed by 20% next year if legislative changes aren't made. For the 55 million retirees and disabled Medicare beneficiaries, the program could remain solvent until 2034. Some advocates say this is plenty of time to address problems without cutting benefits, but others worry the longer lawmakers wait, it becomes more difficult not to make significant changes.
"Today's report shows that we must seek meaningful, in some instances even urgent changes to ensure the program is on stable ground for future generations," said AARP CEO Jo Ann Jenkins.