Industry News

On July 15, 2026, the Center for Retirement Research (CRR) at Boston College published its issue brief, Medicare Finances: A Perspective on the 2026 Trustees Report. The brief summarizes the current state of Medicare’s finances based on the 2026 Medicare Trustees Report released in June 2026.

The brief provides: 1) an overview of the Medicare program; 2) the 2026 Medicare Trustees Report’s projections that use current law assumptions; 3) a comparison of the current-law projections to an alternative scenario prepared by Medicare’s Office of the Actuary; and 4) some possible reasons that Medicare’s expenditures are expected to outpace Social Security.

The report indicates that Medicare is the largest U.S. public health program that covers nearly all individuals age 65 and over in addition to those who receive federal disability insurance benefits. According to the report, the Medicare program accounts for 21% of the national health care spending and 14% of the federal budget.

Some of the other key findings include:

• Overall, the Medicare program, which operates within the U.S. health care system, is very expensive and costs twice as much as health care systems in other countries.
• The findings indicate that if the constraints on reimbursements to physicians and hospitals prevent Medicare beneficiaries from accessing care, it is likely that costs will increase significantly higher than the Trustees project.
• Medicare Advantage plans cover more than 50% of beneficiaries, which costs 14% more per person than traditional Medicare.
• Controlling Medicare costs should be addressed that would require a long-term plan to redesign the U.S. health care system and, in the short term, reduce overpayments for Medicare Advantage plans.

The brief states, “In contrast to Social Security, where population aging can explain all the growth in expenditures over the next 30 years, an aging population explains much less than half of projected future growth in Medicare. The rest comes from the costs for hospital and physician services rising faster than [Gross Domestic Product] GDP.” It adds, “With Medicare growing so quickly, its outlays will surpass Social Security expenditures in 11 years. And by 2100, the end of the projection period, Social Security accounts for 6.7 percent of GDP, while, as noted, Medicare equals 7.5 percent under the Trustees’ current-law assumptions and 9.8 percent under the actuaries’ alternative projections. It should be at the top of everybody’s worry list.”

The brief is available here.