Academy Activities

The Academy's Medicare Steering Committee released its annual issue brief examining the findings of the annual Medicare Trustees Report relating to the program's solvency and sustainability. At a briefing on Capitol Hill today, Tom Wildsmith, the vice president of the Health Practice Council, and Cori Uccello, the Academy's senior health fellow, presented the findings of the 2011 Medicare Trustees Report and offered an actuarial perspective on options to address Medicare's long-term sustainability.

The Medicare Steering Committee also released an issue brief that summarizes the key cost, access, and quality issues associated with many of the Medicare-related provisions in recent debt and deficit reduction proposals.

In a letter submitted to the Centers for Medicare & Medicaid Services (CMS) on May 2, the Academy's Premium Review Work Group commented on a notice on rate increase disclosure and review reporting requirements. The work group raised concerns with the proposed preliminary justification form, including the rate summary worksheet, and with the new consumer disclosure form.

Legislative and Regulatory Updates

The CMS issued a final rule on May 19 that establishes a process for the review and disclosure of "unreasonable" rate increases. The new rule implements Section 2794 of the Public Health Service Act, which was added as part of the Affordable Care Act (ACA), and becomes effective July 18, 2011. The rule also includes a notice that the CMS will consider comments on the definitions of "individual market" and "small group market" if they are submitted by July 18.

The Medicare Board of Trustees released its annual report on the financial status of the Medicare program on May 13. The report projected 2024 as the exhaustion date for the hospital insurance (HI) trust fund assets instead of 2029, as projected in last year's report. The projected HI deficit over the next 75 years is 0.79 percent of taxable payroll. The CMS Office of the Actuary was asked, for the second consecutive year, to develop an alternative scenario that provides an illustration of the potential understatement of current-law Medicare cost projections if the productivity adjustments are phased out and the physician payment reductions are overridden by Congress. Under the alternative scenario, the HI trust funds would be depleted slightly earlier in 2024, and the projected deficit over 75 years would be 2.15 percent of taxable payroll. The report indicated that the program's financial status has improved with the passage of the ACA, and that without the health care law the program's funds would run out in 2016.

In The News/Media Activities

Academy Senior Health Fellow Cori Uccello discussed the 2011 Medicare Trustees Report in a Bloomberg report and in the Minneapolis Star Tribune on May 13. Uccello said that for Medicare to stay solvent for the next 75 years, it immediately would have to raise payroll taxes by 24 percent, or cut current benefit payments by 17 percent.

A new health policy brief by Health Affairs cited the Academy's November 2009 FAQ on the Community Living Assistance Services and Supports (CLASS) Act. The Academy highlighted adverse selection and sustainability concerns with the program and identified options to address some of these concerns.

The Academy's new issue brief exploring proposals to improve Medicare's financial condition was the lead source for a May 25 Reuters Factbox on Medicare reform options.

News links are to external websites. The Academy is not responsible for the content of these websites.

Upcoming Health Care Reform Events

Society of Actuaries Health Meeting
Conference: June 13-15, Boston (fee charged)
Sponsor: Society of Actuaries

For a complete listing of upcoming and recent health care reform events click here.