**GAO-03-247R**                      Published: Mar 04, 2003. Publicly Released: Mar 04, 2003.                  

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## Highlights

Medicare spending growth remains one of the most pressing and complex issues facing the Congress and the nation. During calendar year 2001, the most recent year for which complete data were available at the time of our review, over 40 million Medicare enrollees received $240.9 billion in benefits from the trust funds maintained for Hospital Insurance and Supplementary Medical Insurance, Medicare's two components. The Boards of Trustees of the trust funds are required to report annually on the current and projected financial status of the Medicare program to the Congress and the American people. The Centers for Medicare and Medicaid Services' (CMS) Office of the Actuary (OACT) provides estimates to the boards to assist them in setting certain assumptions about HI and SMI future performance that are needed to prepare long-range and short-range projections of the financial status of the trust funds for the Trustees' reports. Based on the boards' assumptions, OACT then prepares the projections and the Trustees' reports for the boards. In its 2002 annual report, the Board of Trustees estimated that, under current rules, HI expenditures would begin to exceed tax revenue in calendar year 2016, causing the trust fund to be exhausted in 2030. Our specific objectives were to identify and evaluate the adequacy of OACT's (1) control activities over the projection process, (2) human capital practices related to workforce planning, and (3) tracking and resolution process to address recommendations from technical panels and other reviewers.

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## Recommendations for Executive Action

See All 6 Recommendations

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## Topics

Auditing and Financial Management

Future budget projectionsHealth care cost controlInternal controlsMedicarePersonnel managementStaff utilizationTrust fundsAccounting standardsLabor forceWorkforce management