Hospital Insurance Trust Fund

AAA

DEFINITION of 'Hospital Insurance Trust Fund'

This trust fund is part A of Medicare, the United States' health insurance program for people age 65 and older and certain disabled persons. It is financed through payroll taxes derived from current workers and employers. This trust fund is overseen by a board of trustees that report yearly to congress regarding its financial status. It has been projected to become insolvent a number of times throughout the years, due to legislative changes, and is currently projected to become insolvent in the year 2017.

INVESTOPEDIA EXPLAINS 'Hospital Insurance Trust Fund'

The main concern with this fund is that over time, the Nation's economy will not support this type of program. The actual trust fund is an account mechanism, since there is no transfer of money into or out of the fund. Income to the trust fund is credited in the form of interest-bearing government securities. Expenses for services and administrative costs are recorded against the fund. If the fund has a balance, the Treasury is allowed to make payments.

RELATED TERMS
  1. Trust Fund

    A trust fund is a fund comprised of a variety of assets intended ...
  2. Medicare

    A U.S. federal health program that subsidizes people who meet ...
  3. Health Insurance Portability And ...

    An act created by the U.S Congress in 1996 that amends both the ...
  4. Insurance

    A contract (policy) in which an individual or entity receives ...
  5. Health Reimbursement Account - ...

    Employer-funded plans that reimburse employees for incurred medical ...
  6. Health Insurance

    A type of insurance coverage that pays for medical and surgical ...
RELATED FAQS
  1. How do insurance companies use a whistleblower?

    Fraudulent claims are among the most prevalent and serious business risks that insurance companies face. Many consumers have ... Read Full Answer >>
  2. Why should value investors consider the insurance sector?

    Insurance companies receive steady cash flows for years with irregular payouts. Following these payouts, insurance companies ... Read Full Answer >>
  3. What are the major categories of financial institutions and what are their primary ...

    In today's financial services marketplace, a financial institution exists to provide a wide variety of deposit, lending and ... Read Full Answer >>
  4. How can I invest in a mutually owned insurance company?

    Mutually owned insurance companies do not issue stock or other equity securities. This means you cannot become a shareholder, ... Read Full Answer >>
  5. What demographic trends are creating potential profits for insurance companies?

    Insurance companies can profit from demographic trends by marketing and writing specific policies suited to changes in the ... Read Full Answer >>
  6. How are contingent beneficiaries informed of a payout?

    One of the greatest tools in estate planning is beneficiary designation. Listing primary and contingent beneficiaries is ... Read Full Answer >>
Related Articles
  1. Home & Auto

    Fighting The High Costs Of Healthcare

    If your employer is cutting medical benefits, a health savings account may be right for you.
  2. Options & Futures

    Long-Term Care: More Than Just A Nursing Home

    Learn what you can do now to keep your options open in the future.
  3. Options & Futures

    Getting Through The Medicare Part D Maze

    Having trouble sorting through your prescription drug coverage options? We offer some solutions to the confusing process of selecting the right Medicare Part D coverage for you.
  4. Insurance

    What Does Medicare Cover?

    Don't assume you're insured. Find out what you can expect from this healthcare program.
  5. Home & Auto

    Taking The Surprise Out Of Long-Term Care

    Don't be caught unprepared - find out what to look for in LTC insurance policies.
  6. Retirement

    The Top 3 Retiree Worries (And What To Do About Them)

    Discover the most common problems retirees face, and what they can do to solve them.
  7. Insurance

    Who Needs Extortion Insurance?

    Insurance can help mitigate the financial damage of an extortion plot, but it’s important to read the fine print before taking out one of these policies.
  8. Markets

    What Is the Pharmacy Benefit Management Industry?

    PBMs, acting as third party administrators and negotiators, are essential to facilitating transactions between the moving parts of the healthcare industry.
  9. Insurance

    Why Is Health Care So Expensive In The Us?

    The U.S. is the world leader in only one area of health care: costs. Why is it so hard to rein in these expenses?
  10. Insurance

    Do You Need Kidnap & Ransom Insurance?

    Americans working abroad – and high-profile individuals traveling frequently in kidnapping hot spots – should consider this type of protection.

You May Also Like

Hot Definitions
  1. American Dream

    The belief that anyone, regardless of where they were born or what class they were born into, can attain their own version ...
  2. Multicurrency Note Facility

    A credit facility that finances short- to medium-term Euro notes. Multicurrency note facilities are denominated in many currencies. ...
  3. National Currency

    The currency or legal tender issued by a nation's central bank or monetary authority. The national currency of a nation is ...
  4. Treasury Yield

    The return on investment, expressed as a percentage, on the debt obligations of the U.S. government. Treasuries are considered ...
  5. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  6. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!