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Annual Report Shows Medicare Insolvent by 2026

June 8, 2018—An annual report released June 5 by the trustees of the Social Security and Medicare trust funds projects that Medicare’s Hospital Insurance Trust Fund will be depleted by 2026, three years earlier than last year’s estimate (see Washington Highlights, July 14, 2017). The trustees also predicted that overall Medicare costs will increase from 3.7% of gross domestic product (GDP) to 5.8% between 2017 and 2038. From there, it is expected to grow steadily to 6.2% of GDP by 2092.

This solvency projection is due in part to lower revenues from payroll and Social Security benefit taxes, along with higher than forecasted expenditures for payments to hospitals and Medicare Advantage plans in 2017.

In 2017, Medicare covered 58.4 million people, 85% of which were age 65 or older. With this in mind, the trustees encouraged lawmakers to pursue policy options that would reduce or eliminate existing short term-financing shortfalls in Social Security and Medicare as soon as possible, in order to give the public time to prepare for any proposed changes.


Len Marquez
Senior Director, Government Relations
Telephone: 202-862-6281


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Washington Highlights, a weekly electronic newsletter, features brief updates on the latest legislative and regulatory activities affecting medical schools and teaching hospitals.

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Jason Kleinman
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Telephone: 202-903-0806