The Impact of the PPACA on the HI Trust Fund and on the Budget as a Whole

In a report released this afternoon, CBO and the staff of the Joint Committee on Taxation (JCT) estimated that the PPACA, incorporating the manager’s amendment, would reduce Part A outlays by $245 billion and increase HI revenues by $113 billion during the 2010-2019 period. Those changes would increase the trust fund’s balances sufficiently to postpone exhaustion for several years. However, the improvement in Medicare’s finances would not be matched by a corresponding improvement in the federal government’s overall finances. CBO and JCT estimated that the PPACA as amended would add more than $400 billion ($245 billion + $113 billion + interest) to the balance of the HI trust fund by 2019, while reducing federal budget deficits by a total of $132 billion by 2019.