Because of rising healthcare costs, advancing technology, and an aging U.S. population, predicting future Medicare spending is difficult. In 2005, the unfunded liability for Medicare was projected to be close to $30 trillion, according to the current issue of IEEE-USA Today's Engineer Online.
"How well we deal with the funding issue will affect the extent to which we push costs forward to future generations," Today's Engineer author George McClure writes in "Fixing Medicare: An Intergenerational Dilemma."
Medicare is a federal health insurance program for people 65 and older, disabled people under 65 and those with end-stage renal disease. Three-quarters of Medicare costs are covered by the program; the remainder by recipients.
With the expected growth in those eligible for benefits and the uncertainty of future healthcare costs, Medicare Part A, which covers hospital services, is expected to run out of money by 2018. The prescription drug program (Medicare Part D) is also unfunded. To prevent the projected shortfall, some combination of cutting benefits, raising premiums or increasing the payroll tax will have to implemented, according to Today's Engineer.
"The earlier that actions are taken to avert the looming crisis, the easier those actions will be," McClure writes. "But the politics are daunting."