Please ensure Javascript is enabled for purposes of website accessibility
Report: Medicare, Social Security Face Shaky Fiscal Futures
gvw_ap_news
By Associated Press
Published 6 years ago on
April 22, 2019

Share

WASHINGTON — The financial condition of the government’s bedrock retirement programs for middle- and working-class Americans remains shaky, with Medicare pointed toward insolvency by 2026, according to a report Monday by the government’s overseers of Medicare and Social Security.

Many on both sides actually agree that it would be better for Washington to act sooner rather than later to shore up the programs rather than wait until they are on the brink of insolvency and have to weigh more drastic steps.
It paints a sobering picture of the programs, though it’s relatively unchanged from last year’s update. Social Security would become insolvent in 2035, one year later than previously estimated.
Both programs will need to eventually be addressed to avert automatic cuts should their trust funds run dry. Neither President Donald Trump nor Capitol Hill’s warring factions has put political perilous cost curbs on their to-do list.
The report is the latest update of the government’s troubled fiscal picture. It lands in a capital that has proven chronically unable to address it. Trump has declared benefit cuts to the nation’s signature retirement programs off limits and many Democratic presidential candidates are calling for expanding Medicare benefits rather than addressing the program’s worsening finances.
Many on both sides actually agree that it would be better for Washington to act sooner rather than later to shore up the programs rather than wait until they are on the brink of insolvency and have to weigh more drastic steps.

Washington Mostly Ignoring the Problem

“The programs that millions of Americans pay into and expect to have in the future are going broke — driving up federal spending, growing our deficits, and crowding out other priorities in the process. We cannot afford to ignore this reality any longer,” said Arkansas Rep. Steve Womack, ranking Republican on the Budget Committee.
But potential cuts such as curbing inflationary increases for Social Security, hiking payroll taxes, or raising the Medicare retirement age are so politically freighted and toxic that Washington’s power players are mostly ignoring the problem.
Later this year, Social Security is expected to declare a 1.8% cost-of-living increase for 2020 based on current trends, program officials say.
Monday’s report by three Cabinet heads and Social Security’s acting commissioner, urges lawmakers to “take action sooner rather than later to address these shortfalls, so that a broader range of solutions can be considered and more time will be available to phase in changes while giving the public adequate time to prepare.”
If Congress doesn’t act, both programs would eventually be unable to cover the full cost of promised benefits. With Social Security that could mean automatic benefit cuts for most retirees, many of whom depend on the program to cover basic living costs.

Medicare More Difficult to Solve than Social Security

For Medicare, it could mean that hospitals, nursing homes, and other medical providers would be paid only part of their agreed-upon fees.
In a glimmer of good news, Social Security’s disability program is now estimated to remain solvent for an additional 20 years, through 2052. Overall, however, Social Security would run out of reserves by 2035, one year later than projected in last year’s report.

“We remain committed to further bolstering the programs’ finances, which will benefit from the long-term growth we will see as a result of the Administration’s economic policies.” — Treasury Secretary Steven Mnuchin
“We remain committed to further bolstering the programs’ finances, which will benefit from the long-term growth we will see as a result of the Administration’s economic policies,” said Treasury Secretary Steven Mnuchin.
As an indication of Medicare’s woes, it would take a payroll tax increase of 0.91 percentage points to fully address its shortfall or a 19% cut in spending. Medicare’s problems are considered more difficult to solve, as health care costs regularly outpace inflation and economic growth.
Social Security is the government’s largest program, costing $853 billion last year, with another $147 billion for disability benefits. Medicare’s hospital, outpatient care, and prescription drug benefits totaled about $740 billion.
Taken together, the two programs combined for 45% of the federal budget, excluding interest payments on the national debt.

DON'T MISS

What Are Fresno Real Estate Experts Predicting for 2025 and Beyond?

DON'T MISS

First California EV Mandates Hit Automakers This Year. Most Are Not Even Close

DON'T MISS

Visalia Police Hand Out 55 Citations During Motorcycle Safety Crackdown

DON'T MISS

Chronic Stress Linked to Higher Dementia Risk, Experts Warn

DON'T MISS

Authorities Seek Help Finding Relatives of Deceased Fresno Man

DON'T MISS

Valley Crime Stoppers’ Most Wanted Person of the Day: Felecia Johnson

DON'T MISS

How in the World Did Fresno End Up on Trump’s Sanctuary Cities List?

DON'T MISS

X Marks the Spot: Bruised Musk Says His Young Son Punched Him

DON'T MISS

PBS Suing Trump Administration Over Defunding, Three Days After NPR Filed Similar Case

DON'T MISS

Loretta Swit, Emmy-winner Who Played Houlihan on Pioneering TV Series ‘M.A.S.H.,’ Has Died at 87

DON'T MISS

San Francisco 49ers Acquire Eagles Edge Rusher Bryce Huff, AP Source Says

DON'T MISS

California Lawmaker Won’t Be Charged After Citation for Suspicion of Impaired Driving

UP NEXT

1 in 4 US Children Have Parents With Substance Use Disorder, Study Finds

UP NEXT

Dozens Sickened in Expanding Salmonella Outbreak Linked to Recalled Cucumbers

UP NEXT

Speaker Johnson Raises Campaign Money in Fresno

UP NEXT

Business Insider Cuts 21% of Workforce, Memo Shows

UP NEXT

Harvard Agrees to Relinquish Early Photos of Slaves, Ending a Long Legal Battle

UP NEXT

Silence on E. Coli Outbreak Highlights How Trump Team’s Changes Undermine Food Safety

UP NEXT

Trump Pardons Tax Cheat After Mother Attends $1 Million Dinner

UP NEXT

NPR Sues Trump Administration Over Executive Order to Cut Funding

UP NEXT

Justice Department Reaches Deal to Allow Boeing to Avoid Prosecution Over 737 Max Crashes

UP NEXT

Low-Income Compton Students Get $225M State-of-the-Art High School Campus

Hamas Responds to the US Ceasefire Proposal for Gaza While Seeking Amendments

2 hours ago

No. 15 Overall Seed UCLA Eases Past Fresno State Behind a Season-High 22 Hits

2 hours ago

Judge and Ohtani Light Up the First Inning With Historic Homers in Yankees-Dodgers Rematch

2 hours ago

Chapman Homers, Harrison Pitches Five Scoreless Innings as Giants Beat Marlins

3 hours ago

General Is a Good Boy — in English and Spanish

4 hours ago

Two Renovated Tot Lots Promise Family Fun at Roeding Park

4 hours ago

Visalia Police Hand Out 55 Citations During Motorcycle Safety Crackdown

4 hours ago

Chronic Stress Linked to Higher Dementia Risk, Experts Warn

5 hours ago

How Gentrification Is Killing the Bus: California’s Rising Rents Are Pushing Out Commuters

5 hours ago

Authorities Seek Help Finding Relatives of Deceased Fresno Man

19 hours ago

Trans Athlete Competes in California Championships in Clovis Despite National Controversy

CLOVIS — A transgender teen will compete in the California high school track-and-field finals on Saturday, one day after advancing in the co...

57 minutes ago

57 minutes ago

Trans Athlete Competes in California Championships in Clovis Despite National Controversy

2 hours ago

Tim Walz Urges Democrats to Fight Back Harder Against ‘Bully’ Trump

2 hours ago

US Defense Secretary Warns Indo-Pacific Allies of ‘Imminent’ Threat From China

2 hours ago

Hamas Responds to the US Ceasefire Proposal for Gaza While Seeking Amendments

2 hours ago

No. 15 Overall Seed UCLA Eases Past Fresno State Behind a Season-High 22 Hits

2 hours ago

Judge and Ohtani Light Up the First Inning With Historic Homers in Yankees-Dodgers Rematch

3 hours ago

Chapman Homers, Harrison Pitches Five Scoreless Innings as Giants Beat Marlins

General, a lovable 90-pound bilingual pup in Fresno, is fixed, vaccinated, and ready to find his forever home through Mell’s Mutts. (Mell's Mutts)
4 hours ago

General Is a Good Boy — in English and Spanish

Help continue the work that gets you the news that matters most.

Search

Send this to a friend