Officials from the Obama administration announced that due to the recession, the Medicare fund is expected to run out of money by 2017, two years earlier than had been previously predicted, according to a report in The New York Times.
Labor Secretary Hilda L. Solis said in the report that 5.7 million jobs had been lost since Dec. 2007, greatly reducing the amount of payroll taxes the government collects, which is a major source for Medicare funding.
Treasury Secretary Timothy F. Geithner said the only way to keep Medicare solvent was to "control runaway growth in both public and private health care expenditures," according to the report.
Congress has said that it will not let Medicare run out of money. However, if cost control efforts do not result in the expected savings, Congress will most likely have to raise taxes, and higher premiums, co-payments and deductibles could be required of beneficiaries to help cover the costs.
Medicare trustees predict a 30 percent increase in Medicare beneficiaries over the next decade. In addition, one-fourth of existing Medicare patients face sharply increased monthly premiums — around $104 next year and $120 in 2011. Currently, the monthly premium is $96.40, according to the report.
Read the Times' report about the deteriorating Medicare fund.