COVID-19 could accelerate depletion of Medicare hospital fund

  • Small
  • Medium
  • Large

Medicare's hospital fund will be depleted by 2026, but COVID-19 could accelerate that, according to an annual report from the board of trustees of the fund.

The 2026 projection is in line with what last year's report said about Medicare's Hospital Insurance Trust Fund, otherwise known as Medicare Part A. The fund helps pay for inpatient hospital services, hospice care, skilled nursing and home health services provided to Medicare beneficiaries. In 2019, fund expenditures exceeded $5.8 billion.

In 2026, revenue for the fund will only cover 90 percent of the program's costs, rendering the fund insolvent. 

The trustees said the exact projections in the analysis don't reflect potential effects of the COVID-19 pandemic due to the high uncertainty associated with the effects. But the trustees said the pandemic is likely to materially affect the assumptions the intermediate projections are based on. 

"Given the potential magnitude of the effects of the pandemic, it is conceivable that actual program experience could be worse than projected in the high-cost scenario, particularly in the near term," the trustees said. 

Read the full report here.

More articles on healthcare finance:
CMS to release another $30B in hospital aid: 5 things to know
Tennessee hospital closes as several others struggle to stay afloat
HCA records 44% drop in profit, pulls 2020 guidance


Copyright © 2021 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Featured Whitepapers

Featured Webinars