Medicare Hospital Trust Fund Will Be Insolvent by 2040, Report Says

The Medicare Hospital Insurance Trust Fund is projected to be exhausted by 2040, 12 years earlier than estimated in March 2025, according to the Congressional Budget Office’s February projection. If the balance of the fund reaches zero and the fund’s spending continues to surpass its income, total benefits under Medicaid Part A would be reduced by 8 percent in 2040. The reduction would rise to 10 percent by 2056. The trust fund is used to cover Medicare Part A benefits, which include inpatient hospital services, skilled nursing, home health care, and hospice care. The fund had a balance of $375.9 billion at the beginning of 2026, which will grow over the next five years. But by 2032, expenses will exceed income, draining the account by 2040 according to the estimate....