July 29, 2021

Medicare coverage could be cut to less than a third of what it is today, a new report says.

The report, released Wednesday by the Medicare Trustees, is the latest indication that the federal government could face a $3.5 trillion shortfall in Medicare revenue over the next 10 years if it does not act soon.

The findings of the Medicare study are the latest in a series of reports that have been issued by the Centers for Medicare and Medicaid Services since last week that are based on a broad range of data, including recent federal budget projections and past congressional testimony.

“The Medicare program has historically been the foundation of our economy and it has been the bedrock of our health care system for decades,” CMS Secretary Sylvia Mathews Burwell said in a statement.

“The current projections are extremely concerning and the American people deserve a full accounting of what is needed to address the looming shortfall.”

The study’s authors estimate that Medicare coverage would decrease by about 17 percent, from about 63.6 million people in 2019 to 61.3 million in 2027.

They also estimate that about 8 million fewer people would be covered in 2026, but the numbers don’t specify how many.

The authors warn that the numbers could rise as the Medicare program continues to grow, as seniors age and new entrants into the program become eligible for benefits.

In 2019, the share of Medicare beneficiaries aged 65 and older would be about one-third, and in 2023 it would be one-quarter.

“Medicare is already suffering under the strains of rising costs, which are causing hospitals to lay off staff, limiting access to care, and reducing utilization of services,” Mathews said.

“We cannot continue to spend billions on Medicare when our seniors are already hurting.”

Michele Stearns, the co-author of the study and a vice president at the Kaiser Family Foundation, said in an email that the government should be investing more in the Medicare system.

“Medicare currently covers only about 4 percent of all Medicare enrollees, and the federal budget needs to ensure that it does more to help ensure that more people have access to affordable care.”

Stearns said that even with a smaller Medicare contribution, the federal deficit could reach $2 trillion if Congress doesn’t act to address a projected $1.6 trillion shortfall, or $300 billion in the next decade.

She also said the report is an important first step toward addressing the growing shortfall in funding that has been caused by the economic downturn.

“There is still plenty of time to address Medicare’s needs before they become unsustainable,” Stearnes said.

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