NCPA


Policy Issues

NCPA Publications

Both Sides

Editorial Opinions

Audio/Visual


NATIONAL CENTER FOR POLICY ANALYSIS
HOME / DONATE / ONE LEVEL UP / ABOUT NCPA / CONTACT US
Medicare's Approaching Debacle
Daily Policy Digest

Health Issues / Medicare's Growing Financial Crisis

Wednesday, May 15, 2002
Experts warn that Medicare's financial plight may exceed that of Social Security. This year's Medicare Trustees' Report predicts bankruptcy for Medicare in 2030. Social Security won't go broke until 11 years later, according to current projections.

But Medicare's demise will leave about 80 million Americans adrift and on their own to finance their health care.

  • Although Medicare is currently running a surplus, that will vanish as demographics shift.
  • Medicare revenues are now 2.6 percent of gross domestic product -- which will grow to 3.7 percent by 2030, and 5.3 percent in 2076.
  • Expenditures are 2.5 percent of GDP now -- and projected to triple to 8.6 percent by 2076.
  • The worker-to-recipient ratio is falling -- and will go from more than 3-1 now to 2-1 by 2026.
Achieving financial stability requires adopting some ultra-painful political options -- raising taxes, lowering benefits, cutting budgets or adopting deficit spending.

Source: Sean Higgins, "Medicare's Pending Collapse Could Dwarf Social Security," Investor's Business Daily, May 14, 2002.

For more on Medicare's Growing Financial Crisis
http://www.ncpa.org/iss/hea
12770 Coit Rd., Suite 800 - Dallas, TX 75251-1339 - 972/386-6272 - Fax 972/386-0924
601 Pennsylvania Ave. NW, Suite 900 South Building - Washington, DC 20004 - 202/220-3082 - Fax 202/220-3096
Copyright © 2002 National Center for Policy Analysis - All rights reserved.