WASHINGTON, DC: President Donald Trump is opening a little-used corner of Medicare financing to deliver one-time $90 payments to more than 20 million Medicare Part B enrollees, drawing attention to a fund created in 2008 that the Centers for Medicare and Medicaid Services had never spent.
The White House says payments will arrive in early October.
The Medicare Improvement Fund was established in 2008 to support improvements to original Medicare’s fee-for-service program, covering Parts A and B.
A 2023 Congressional Budget Office report found that CMS had made no outlays from the fund since its creation.
CBO also found that lawmakers had changed its available amount 28 times, increasing it 11 times and reducing it 17 times.
The latest law provides $2.062 billion for expenditures from the fund for services furnished during and after fiscal year 2027.
The fund also has a major connection to the Affordable Care Act.
CBO records show that the 2010 health law reduced the amount available by about $20.7 billion.
The White House describes that change as Democrats “raiding” the fund and says previous Congresses used it in ways that increased healthcare costs.
Trump announced that more than 20 million beneficiaries will receive $90 each to help pay Medicare Part B premiums.
The White House says the initiative will be the first use of the Medicare Improvement Fund by a presidential administration.
The statutory language says the fund is available to the HHS secretary to make improvements to original Medicare and adjust payments for healthcare services.
It does not specifically describe a $90 payment to beneficiaries.
The White House calls the move a way to lower seniors’ costs and says the fund should directly benefit Medicare recipients.
Under the statute, the fund supports original fee-for-service Medicare, rather than Medicare Advantage, making the administration’s chosen mechanism central to the announcement.
Therefore the distinction is important to understand.
At $90 for 20 million people, the announced payments would total at least $1.8 billion.
That is about 87% of the $2.062 billion amount currently authorized for the fund.
The White House says most Medicare Part B enrollees qualify.
People whose Part B premiums are already paid by Medicaid and beneficiaries who pay an Income–Related Monthly Adjustment Amount are excluded.
Eligible beneficiaries are expected to receive the money in early October.
Those with direct deposit will receive electronic payments, while others will get checks at their Medicare mailing address.
Reports state that the administration is distributing $500 payments to nearly one million Americans who were overcharged for Affordable Care Act plans.
Trump has also continued promoting a proposed $5,000 “Trump Dividend” for US citizens if Republicans retain control of Congress after the midterm elections.
The $90 Medicare payment is separate from that proposal.
For seniors receiving the new payment, the administration says $90 will be applied toward Part B premium costs this month.
