Medicare's hospital trust fund insolvency date remains 2024, according to Monday's annual report (PDF) by the program's trustees, but only because of a 2% reduction in provider payments scheduled to start in January.
The solvency date would have accelerated without the cut, the Social Security and Medicare trustees board reported, because of technical changes in their short-term cost assumptions. The Medicare provider cut is part of the deficit-reduction package to which Congress and President Obama agreed last summer.
The trust fund's expenditures have exceeded its income each year since 2008. Despite projections that over the next 10 years the fund's expenditures will grow by an annual average of 5.3% and its income by an average 6%, the fund is expected to have enough revenue by 2024 to pay only 87% of projected costs for that year.
A recent analysis by a group of House and Senate Republicans concluded that Congress would have few options to continue provider payments if such a shortfall occurred.