From The New York Times —
WASHINGTON — The financial outlook for Medicare and Social Security, two of the nation’s most important social safety net programs, remains precarious, threatening to diminish retirement payments and increase health care costs for Americans in old age, the Trump administration said on Monday, April 29.
An annual government report on the status of the programs painted a dire portrait of their solvency that will saddle the United States with more debt at a time when the economy is starting to cool and taxes have just been cut.
According to the report, the cost of Social Security, the federal retirement program, will exceed its income in 2020 for the first time since 1982. The program’s reserve fund is projected to be depleted in 16 years, at which time recipients will get smaller payments than they are scheduled to receive if Congress does not act.
Meanwhile, Medicare’s hospital insurance fund is expected to be depleted in 2026 — the same date that was projected a year ago. At that point, doctors, hospitals and nursing homes would not receive their full compensation from the program and patients could face more of the financial burden.
“Lawmakers should address these financial challenges as soon as possible,” the trustees of the program wrote. “Taking action sooner rather than later will permit consideration of a broader range of solutions and provide more time to phase in changes so that the public has adequate time to prepare.”
Although the report presented a grim long-term outlook, it was something of a bright spot that Social Security’s reserves are not depleting more quickly. The program’s disability fund is now not expected to run out until 2052 — 20 years later than what was projected last year.
Government officials said during a news briefing before the release of the report that a strengthening economy and broader access to health care, as a result of the Affordable Care Act, are responsible for declining disability claims.
Some Republicans sought to take credit on Monday for the fact that the news was not worse while also calling for changes to the programs.
“Following historic reforms to America’s tax code, this strong economy has strengthened these important programs, but today’s reports remind us of a fact we have known for far too long: Medicare is going broke and Social Security is not solvent,” Representative Kevin Brady, Republican of Texas, said in a statement.