Medicare is the second-largest social insurance program in the United States. As of 2021, the program served almost 64 million beneficiaries and had total expenditures of $830 billion.

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Because the number of beneficiaries is increasing faster than the number of workers, together with an increase in the volume and intensity of services delivered, Medicare is becoming increasingly strained.  From the latest report from its Board of Trustees:  "As it has since 2004, the Hospital Insurance Trust Fund (HI) fails to meet the Board of Trustees’ short-range test of financial adequacy.  In addition, as in all past reports, the HI trust fund fails to meet the Trustees’ long-range test of close actuarial balance."  Read the report here.

 

But Medicare has bigger problems than even that.  This is an incredibly important program, but it needs major reform.  First and foremost, we have to get a handle on the rampant fraud, waste, and abuse within the Centers for Medicare & Medicaid Services (CMS).  The U.S. Government Accountability Office (GAO) says that "CMS, which administers Medicare, faces many challenges related to implementing payment methods that encourage efficient service delivery, managing the program to serve beneficiaries well, and safeguarding the program from loss due to fraud, waste, and abuse."  They go on to say "Medicare has been designated as a High Risk program because its complexity and susceptibility to improper payments, in addition to its size, have led to serious management challenges. Addressing these challenges requires improvements to payment methods, program management, and program safeguards."

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Cleaning up this mess will be facilitated through Operation Overhaul, which has A LOT of work to do!

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