II

104TH CONGRESS

1ST SESSION S. 785

To require the Trustees of the medicare trust funds to report recommendations on resolving projected financial imbalance in medicare trust funds.

IN THE SENATE OF THE UNITED STATES

MAY 9 (legislative day, MAY 1), 1995

Mr. PACKWOOD introduced the following bill; which was read twice and

referred to the Committee on Finance

A BILL

To require the Trustees of the medicare trust funds to report

recommendations on resolving projected financial imbalance in medicare trust funds.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. TRUSTEES’ CONCLUSIONS REGARDING FINAN4 CIAL STATUS OF MEDICARE TRUST FUNDS.

5 (a) HI TRUST FUND.—The 1995 annual report of

6 the Board of Trustees of the Federal Hospital Insurance

7 Trust Fund, submitted on April 3, 1995, contains the fol8 lowing conclusions respecting the financial status of such

9 Trust Fund:
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1 (1) Under the Trustees’ intermediate assump2 tions, the present financing schedule for the hospital

3 insurance program is sufficient to ensure the pay4 ment of benefits only over the next 7 years.

5 (2) Under present law, hospital insurance pro6 gram costs are expected to far exceed revenues over

7 the 75-year long-range period under any reasonable

8 set of assumptions.

9 (3) As a result, the hospital insurance program

10 is severely out of financial balance and the Trustees

11 believe that the Congress must take timely action to

12 establish long-term financial stability for the pro13 gram.

14 (b) SMI TRUST FUND.—The 1995 annual report of

15 the Board of Trustees of the Federal Supplementary Med16 ical Insurance Trust Fund, submitted on April 3, 1995,

17 contains the following conclusions respecting the financial

18 status of such Trust Fund:

19 (1) Although the supplementary medical insur20 ance program is currently actuarially sound, the

21 Trustees note with great concern the past and pro22 jected rapid growth in the cost of the program.

23 (2) In spite of the evidence of somewhat slower

24 growth rates in the recent past, overall, the past

25 growth rates have been rapid, and the future growth
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1 rates are projected to increase above those of the re2 cent past.

3 (3) Growth rates have been so rapid that out4 lays of the program have increased 53 percent in ag5 gregate and 40 percent per enrollee in the last 5

6 years.

7 (4) For the same time period, the program

8 grew 19 percent faster than the economy despite re9 cent efforts to control the costs of the program.

10 SEC. 2. RECOMMENDATIONS ON RESOLVING PROJECTED

11 FINANCIAL IMBALANCE IN MEDICARE TRUST

12 FUNDS.

13 (a) REPORT.—Not later than June 30, 1995, the

14 Board of Trustees of the Federal Hospital Insurance

15 Trust Fund and the Board of Trustees of the Federal

16 Supplementary Medical Insurance Trust Fund shall sub17 mit to the Congress recommendations for specific program

18 legislation designed solely—

19 (1) to control medicare hospital insurance pro20 gram costs and to address the projected financial

21 imbalance in the Federal Hospital Insurance Trust

22 Fund in both the short-range and long-range; and

23 (2) to more effectively control medicare supple24 mentary medical insurance costs.
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1 (b) USE OF INTERMEDIATE ASSUMPTIONS.—The

2 Boards of Trustees shall use the intermediate assumptions

3 described in the 1995 annual reports of such Boards in

4 making recommendations under subsection (a).

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