Medicare trust funds will be insolvent starting 2026

Chip Somodevilla  Getty Images North America

Medicare will run out of money sooner than expected, and Social Security's financial problems can't be ignored either, the government said Tuesday in a sobering checkup on programs vital to the middle class.

Medicare's Board of Trustees blamed the earlier depletion forecast on expectations of lower payroll taxes and less revenue from taxing Social Security benefits, both the result of the tax overhaul signed by President Donald Trump past year, according to a senior administration official.

The Social Security program's costs are expected to exceed its income this year, marking the first time that has happened since 1982 and forcing the US government to dip into the retirement system's trust fund to pay benefits to participants. However, certain long-term issues persist.

Unless lawmakers act, both programs face the prospect of being unable to cover the full cost of promised benefits.

"The administration's economic agenda - tax cuts, regulatory reform and improved trade agreements - will generate the long-term growth needed to help secure these programs", Treasury Secretary Steven Mnuchin said Tuesday.

Spending was also projected to be somewhat higher than last year's estimates due to legislative changes that led to higher hospital and Medicare Advantage payments.

More news: Victor Moses joins Nigeria after second honeymoon
More news: Active Shooter removed from Steam amidst controversy
More news: Israel, Russia Reach 'Understanding' on Iranian Presence in Syria

The trustees report is considered an annual wake-up call for the beleaguered programs, though consensus around ways to secure their future remains elusive.

"This report should eliminate any doubt that Trump's tax law yanked Medicare closer to insolvency", Senator Ron Wyden of OR, the top Democrat on the Finance Committee, said in a statement. "Now is the time Congress should prepare for the future, not by threatening workers' benefits, but by expanding Social Security". The ratio of workers to beneficiaries fell to 3.3 in 2005 and then to 2.8 in 2016.

The aging of the population is another factor in the growth of the two entitlement programs. "The truth is, Social Security doesn't add a dime to the deficit and is the retirement bedrock of millions of Americans and we should keep it that way", Representative Deutch said.

Social Security recipients are likely to see a cost-of-living increase of about 2.4 percent next year, said government number-crunchers who produced the report.

Two other Medicare funds - Part B, which covers doctor and outpatient visits and Part D, which covers prescription drugs - are reset each year based on projected costs.

Related News:



Most liked

Aamir is a huge fan of this Southern star
Upset with Rajinikanth's statement over the Cauvery row, a Karnataka film body banned the release of the film earlier this month. The film, however, will have its full-fledged release in the state on Friday, The New Indian Express reported.

Kendrick Perkins gives Kevin Durant 2 middle fingers during postgame interview
The Golden State Warriors defeated the Cleveland Cavaliers 110-102 late Wednesday in the NBA Finals to take a commanding 3-0 lead. And that allowed Kevin Durant to conserve some energy en route to a stunning game-high 43 points on 65.2 percent shooting.

Elon Musk fends off challenge to Tesla control
Tesla will announce as soon as next month a combined battery production and vehicle assembly Gigafactory in Shanghai, China. Additionally, we can see that the crossover will have a more upright and pronounced front fascia than current Tesla models.

Dennis Rodman will be in Singapore for USA-North Korea summit
Topping their demands is the elimination of "all nuclear, chemical and biological weapons from North Korea". Singapore also revoked all work permits held by North Korean citizens in March.

Destiny 2 DLC roadmap set to Summer 2019
Furthermore, Bungie announced that the abilities for each class of Guardian will also change when Forsaken drops in September. Where things get interesting is Gambit allows one player from each team to invade their opponent's arena.

Messi: I don’t consider myself the best
Lionel Messi of Argentina stretches before an global friendly match between Argentina and Haiti at Alberto J. Armando Stadium on May 29, 2018, in Buenos Aires , Argentina .

Data sharing deals plague Facebook
The deals were struck around the same time the first iPhone was introduced, and when Facebook launched its first mobile website. He stated that if a user does not want their data shared with a third-party company, all they have to do is opt-out.

Company's First Ever Gaming Smartphone
It also houses a Pixart PAW3327 optical sensor, which supports DPI up to 6200- more than enough sensitivity for most gamers. The main design highlight of the phone is its 3D vapor-chamber cooling system for keeping the device from overheating.

Sears Hometown Store closing in Lompoc
Even though the current retail environment is hard for many retailers, Sears' performance has been much worse than its rivals. Earlier this year , the company shuttered locations in Wilmington and Asheville as well as five other stores in the state.

The Times divulges Abramovich's plans to sell Chelsea for 1.2 billion euros
It has not been confirmed that the Abramovich situation is the reason, but that is the assumption of most observers. Blanc is the "prime candidate" for the Chelsea job, the Mail reports , and is available immediately.

U.N. voices concern over Saudi arrest of women's rights activists
Crown Prince Mohammed bin Salman also instructed the kingdom's interior ministry to fully enact the law, Saudi Gazette reported . This follows King Salman's historic decision in September 2017 to allow women to drive from June 24 .

Hawaii orders fresh evacuations amid fast-moving lava
Many have evacuated the area, and several have made a decision to stay in order to protect their belonging from thieves. Furthermore, if sulfuric acid is added to sugar, USGS officials say there would be a "pretty spectacular reaction".

It's Cleveland vs. Golden State, round 4
When Nichols asked if James' relationship with Gilbert would affect his free-agency decision, James said, "We're going to see". The key addition for the Warriors that helped them immensely during that recent stretch is Durant, the 2017 NBA Finals MVP.

Four reasons why the team will win Game 7
But the Cavs made just enough threes - two more than Boston - despite shooting 25.7% from that distance. If Paul can find a way to get on the floor, even if it's in limited minutes, he is going to play.

Official tally shows big win for abortion rights in Ireland
Two polls on behalf of national broadcaster RTE and the Irish Times correctly suggested a landslide victory for the Yes campaign. Irish pro-choice campaigners have vowed to stand with and support advocates of abortion reform in Northern Ireland.





Most Commented