Healthcare professionals have been predicting that Medicare might run out of money in 2026 for sometime now. But with the country’s growing financial burden of COVID-19, more healthcare professionals are predicting that Medicare could be running out of funding sooner than later. Government officials are divided on their responses to the potential Medicare crisis, including President Trump.
With over 61 million Americans relying on the dwindling healthcare provider, 7.5 million of those Americans still are not able to afford their medications. Simply put, coronavirus is running the government program dry and seniors are paying the price. Healthcare professionals were originally predicting Medicare’s bankruptcy to occur in 2026, but with the unexpectancy of COVID-19, some are now claiming it could be as early as 2022.
The debate of time
“I think we have a real, impending health care crisis,” said Dr. David Shulkin, former undersecretary for health at the Department of Veterans Affairs for the Obama Administration and led the VA for a year under Donald Trump.
Shulkin, now a senior fellow at the Leonard Davis Institute of Health Economics at the University of Pennsylvania, predicts that the Medicare’s trust fund could expire as early as 2022 or 2023. His predictions were based on a conservative estimate of how many workers and businesses would not be contributing payroll taxes that finance Part A spending.
“I think this is something that needs more immediate attention,” Shulkin said.
Other healthcare professionals disagreed with the predicted Medicare timeline and healthcare priorities. One being, Chip Kahn, president and CEO of the Federation of American Hospitals. Kahn stated, “I’m not going to worry about this right this minute,” he said. “At this point, my focus is completely on COVID.”
The Committee for a Responsible Federal Budget, a nonpartisan group of budget experts focused on fiscal policy, estimates that the pandemic will cause the Part A trust fund to be unable to pay all of its bills starting in late 2023 or early 2024. “But we’re still very close,” said Marc Goldwein, the group’s senior vice president.
Most financial experts believe that Medicare would reimburse hospitals and other Part A providers 100 percent of their claims until the fund literally runs out of money, and then would pay claims only as more money flows in. Some argue that Medicare might reimburse only a percentage of those claims though.
The biggest budget concerns are either the funding is insufficient or the payments going out for care are too high.
In regards to the government’s financial priorities, Goldwein said, “They’re more concerned with next month than with 2023 at this point”.
Trump’s focus back on healthcare
In an attempt to gain re-election, President Donald Trump has signed a series of executive orders last week to lower prescription drug prices, focusing on allowing discounts and importing cheaper drugs from abroad. If these orders are implemented, Medicare’s financial burden might be lifted in regards to prescription drug costs, Part D.