According to the annual Social Security and Medicare trustees report released on Monday, the go-broke dates for Social Security and Medicare have been pushed back due to altered expected depletion dates brought about by a stronger economy. (Photo : by Brendon Thorne/Getty Images)
The annual Social Security and Medicare trustees report revealed that the go-broke dates for both programs have been postponed due to a stronger economy, but policy adjustments are still needed to ensure full benefits for retired Americans.
Medicare's hospital insurance trust fund go-broke date was pushed back to 2036, while Social Security's trust funds will run out in 2035 instead of the previously forecasted 2034. However, both programs face challenges in funding, with Medicare potentially only able to cover 89% of certain healthcare costs.
Social Security Administration Commissioner Martin O'Malley highlighted the need for congressional action to prevent a 17% cut in Social Security benefits. President Biden reaffirmed his commitment to strengthening Social Security and Medicare, emphasizing the importance of fair contributions from high-income taxpayers to support these critical programs.
According to the annual Social Security and Medicare trustees report released on Monday, the go-broke dates for Social Security and Medicare have been pushed back due to altered expected depletion dates brought about by a stronger economy.
However, experts caution that policy adjustments are necessary to prevent the programs from failing to provide retired Americans with their full benefits.
In the most recent report, Medicare's go-broke date for its hospital insurance trust fund was rescheduled from 2022 to 2036, partly due to lower-than-expected spending from the previous year and more payroll tax revenue. Medicare is a health insurance program offered by the federal government to those 65 years of age or older, as well as those with serious diseases or disabilities. The majority of those it covered, nearly 66 million, were 65 years of age or older.
Medicare would only be able to pay 89% of the costs for hospital visits, hospice care, nursing home stays, and home health care that comes after a hospital visit if the fund's reserves were exhausted.
Meanwhile, rather than the 2034 forecast from last year, Social Security's trust funds, which provide payments to old age and disability users, will not be able to pay full benefits starting in 2035. Only 83% of benefits may be paid by Social Security.
"A measure of good news," according to Social Security Administration Commissioner Martin O'Malley, who also told The Associated Press that "Congress still needs to act in order to avoid what is now forecast to be, in absence of their action, a 17% cut to people's Social Security benefits."
Social Security payments are received by around 71 million individuals, including children, pensioners, and those with disabilities.
President Joe Biden reaffirmed his commitment to bolstering Social Security and Medicare in response to the report. He emphasized his dedication to ensuring the stability and strength of these benefit programs during his presidency. Additionally, Biden stressed the importance of high-income taxpayers contributing their fair share to enhance funding for these vital programs.
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