As reported by the program's trustees, the Medicare Trust fund will become bankrupt in 2024 due to a sluggish economy, health care cost increases and tax breaks. The trustees also warned that reform beyond the Affordable Care Act is needed to rein in Medicare’s rising costs, expected to nearly double from 3.6% of the GDP in 2010 to 6.2% by 2085.

Keep in Mind: According to the health care reform law, physician payments will be docked 30% starting Jan. 1.

The new healthcare law includes a series of cuts to hospitals and other medical providers designed to spur increased efficiency. While the trustees' report suggested that these steps would slow Medicare cost growth by 25% over the next 75 years, there is widespread recognition that this is not enough.

This year is also the first time that Social Security and Medicare are paying out more in benefits than they collect in revenue, requiring the government to pay out the difference; adding to budget deficits.

Keep in Mind: The Medicare trust fund pays for Medicare Part A, which affects hospital insurance. Part B Payments are funded entirely by tax revenue and premiums paid by beneficiaries themselves.

We hope this information from ECP researchers help your billing department assure correct payment for claims.

Please contact us if you have any questions.