Earlier this month, the Medicare Trustees, the board charged with assessing the program's financial health, released its 2012 report confirming that Medicare is on an unsustainable path and will become insolvent in 2024. Recognizing that Medicare is a lifeline for America's seniors, House Republicans have put forward positive solutions to protect the program for today's seniors and save it for generations to come. Rather than joining us in this effort, Democrats continue to avoid confronting this generational crisis.
Testifying in a hearing of the House Budget Committee, Treasury Secretary Timothy Geithner admitted that the Obama Administration does not "have a definitive solution to our long-term problem," and added "what we do know is that we don't like yours." In other words, they have found no time to put together a plan to save Medicare and avoid a predictable debt crisis but plenty of time to launch political attacks against House Republicans. This is the epitome of empty leadership.
Three engines are driving Medicare towards a fiscal cliff -- demographics, health care costs, and gimmicks. More than 10,000 Baby Boomers reach retirement age each day. Thanks to the most innovative health care system on earth, Americans are living longer than we were when Medicare was created in 1965. That's good news. Unfortunately, the worker to beneficiary ratio is decreasing steadily. Twelve years ago, for every senior depending on the program, four workers funded the benefits. By 2030, just over two workers will support each senior.
While the number of workers paying into the system steadily declines, healthcare costs soar higher. Health care inflation continues to outpace the rate of inflation in the real economy. Over the past ten years, health care inflation has grown 48 percent. While everyone in Washington agrees that costs are climbing, gimmicks and misguided top-down solutions are only making the problem worse.
In order to fuel President Obama's unpopular health care law, Democrats siphoned half a trillion dollars out of the Medicare trust fund. This decision pushed Medicare closer to insolvency and revealed that the President's health care law relies on central planning.
Beginning in 2014, the Independent Payment Advisory Board (IPAB), a government panel of fifteen unelected bureaucrats, will have the power to effectively deny care to seniors by determining what to pay doctors to provide treatments and services. This is not an imaginary scenario. It's a fact, and part of the reason that more than half of doctors in this country believe that the current health care law will force them to close or restrict their practices to Medicare patients.
Seniors will pay the price if Washington allows the status quo to continue. That's why we are taking important steps to change course while there's still time. We've put forward a responsible plan to improve and strengthen Medicare. Importantly, by acting now, we make sure that there are no changes for those in or near retirement.
Our plan for Medicare -- which was part of our budget that passed through the House of Representatives in March -- has a history of bipartisan support. It guarantees coverage and offers seniors choices. It is an approach based on the belief that patients come first.
Saving Medicare starts by placing trust in Americans, not Washington planners. Instead of blindly following fifteen government bureaucrats, our plan empowers millions of seniors. Under our plan, patients will select from a list of guaranteed coverage options that best fit their needs. We have taken care to ensure that the traditional Medicare option is among the choices. Low-income seniors or those with higher health risks will receive greater support while wealthier individuals will receive less support.
It is disappointing to see some in Washington turn to scare tactics and broken promises. The airways are already crowded with talk about Republicans "ending Medicare." That whopper earned PolitiFact's "Lie of the Year" award. America's seniors are smart enough to see through this.
Medicare's current course is unsustainable and irresponsible. Unless we act swiftly and decisively, it will become insolvent in 2024 and seniors today and for generations to come will pay the price for Washington's failures. By empowering seniors and increasing coverage options, we can save Medicare.