Medicare reform is likely to reemerge as a leading national issue in the next year. In an era of growing budget deficits, the choices facing policymakers will be even tougher this time around. Perhaps more than ever, the Fund's Program on Medicare's Future is needed as a source of independent, authoritative analysis to help weigh the major options for restructuring Medicare, especially their potential impact on the low-income elderly, the chronically ill, and other vulnerable beneficiaries. Program director Marilyn Moon and staff will focus over the next year specifically on: further development and refinement of a 'high option' Medicare benefit package with higher premiums but lower cost-sharing; managed care's ability to limit beneficiaries' out-of-pocket costs; the infrastructure needed for a prescription drug benefit; and modernization of Medicare's fee-for-service component.