LAT: Medicare's Troubles May Be Sleeping Giant (worse than Soc. Sec.) [View All]

[DeepModem Mom]

Medicare's Troubles May Be Sleeping Giant
The program could run out of funds two decades before Social Security is forecast to, experts say.

By Ricardo Alonso-Zaldivar, Times Staff Writer


WASHINGTON — As restructuring Social Security moves to the top of his agenda, President Bush is sidestepping a troublesome problem: Medicare, which provides health insurance for 41 million elderly and disabled people, is fast going broke.

Medicare is projected to exhaust its hospital-care trust fund by 2019, more than 20 years before Social Security is forecast to slide into the red. The day of reckoning could come even sooner, because Medicare's condition has been going from bad to worse.

The government's unfunded promises to future retirees under Medicare amount to a staggering $27.7 trillion over the next 75 years, according to Congress' Government Accountability Office. That dwarfs the $3.7-trillion liability over the same period for Social Security....

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The Bush administration holds out hope that new tax-free health savings accounts could someday be adapted to Medicare, allowing individuals to control their own costs. These accounts, created by the Medicare overhaul, allow individuals to set aside money tax-free for health expenses not covered by catastrophic-insurance policies. But it's not clear that such accounts would be attractive for heavy consumers of medical services living on fixed incomes....


http://www.latimes.com/news/nationworld/nation/la-na-medicare20dec20,0,2564229.story?coll=la-home-headlines