When will Medicare become insolvent?

When will Medicare become insolvent?  Pick a number from the chart below.

In 1991, the Medicare trustees predicted the fund would run short by 1999.  The latest prediction is that will be be okay until 2024.

Now, the failure of dire predictions to come true doesn’t mean they never will.  The ending of the story of the boy who cried “wolf” was that, one day, the wolf really came.

But remember that “insolvent” does not mean “broke.”  It means that, at some future date which we cannot predict, Medicare will not be able to pay 100 percent of promised benefits unless a change is made in the meantime.

Hat tip to Hullabaloo

[Added 6/18/11]  It is true, though, that there is great room for improvement in the financing and administration of Medicare.  It is something that grew up over the years, with programs being added on without much thought to its functioning as a whole.  Some parts are financed through dedicated payroll taxes, some through premiums, some through general taxation.

If Medicare did not exist, nobody would propose creating it in its present form.  The problem is that most of the would-be “reformers” of Medicare are hostile to its basic purpose.   Today’s Medicare is the least bad system that a majority can support.

Click on Medicare as we know it for a primer on the basics of Medicare.

Tags: Medicare, Medicare budget forecast, Medicare involvency, Medicare projections