The Affordable Care Act, Medicare Costs, and Retirement Security

Source: Alicia H. Munnell and Anqi Chen, Center for Retirement Research at Boston College, Issue in Brief, IB#15-20, November 2015

The brief’s key findings are:
– The 2010 Affordable Care Act (ACA) included roughly 165 provisions to improve Medicare’s finances.
– The Medicare Trustees Report, which reflects the ACA provisions, shows dramatically lower cost projections for Medicare in the future.
– The Medicare actuaries also produce alternative projections assuming that the legislated restraints on growth in payments to health providers are not feasible.
– A review of both sets of projections over the past six years shows that the gap between them is narrowing due to declines in the alternative cost projections.
– However, a significant gap still remains, which underscores the inherent uncertainty involved in long-range projections.