Newspaper article THE JOURNAL RECORD

Medicare Fund Could Run Dry by Year 1988

Newspaper article THE JOURNAL RECORD

Medicare Fund Could Run Dry by Year 1988

Article excerpt

WASHINGTON (AP) _ Rising health care costs have left the Medicare trust fund with only enough money to pay hospital benefits for senior citizens and disabled Americans through this decade, according to a federal report released Tuesday.

The report shows that Medicare's hospital insurance trust fund will be exhausted as early as 1998.

More optimistic estimates suggest the trust fund could remain solvent through the year 2000, but that's still sooner than expected.

The board of trustees for Medicare's Hospital Insurance Trust Fund, which issued Tuesday's report, had predicted last year that the fund's reserves would be exhausted by the year 2002.

"These new estimates show a significant worsening in the economic health of the Medicare program," said Health and Human Services Secretary Donna E. Shalala. "They reflect many of the problems that we see across the board in our health care system today and they are another demonstration of the need for system-wide change."

Congress is likely to act before there is any real threat to seniors' hospital insurance. A congressional aide noted that while the trustees' reports suggest "the sky is falling. . .it never does."

Members of the Medicare hospital insurance board of trustees are Shalala; Treasury Secretary Lloyd Bentsen; Labor Secretary Robert Reich; and Stanford Ross and David Walker, presidential appointees who represent the public.

The five are also members of the boards of trustees for the Social Security retirement and disability insurance trust funds. Their report Tuesday indicates that while the retirement trust fund has enough money to pay benefits for decades, the disability insurance trust fund is also going broke.

The trustees' report says the disability insurance fund will be exhausted by 1995. Last year, their report said the fund would be insolvent by 1997.

The trustees recommended that Congress avert problems for the disability trust fund by reallocating the payroll taxes that finance both disability and Social Security's retirement trust funds. …

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