Medicare And Social Security’s Cloudy Future

by Public Notice Learn: This year, there are expected to be nearly 58 million Social Security beneficiaries and nearly 52 million enrollees in Medicare Part A . Even with those numbers growing every year, though, Americans just aren't sure that they can count on Social Security and Medicare. They've got reason to worry: without real reform, the two programs are on track to face serious financial issues within the next 20 years when their respective trust funds become depleted. If that were to happen, benefits and claims could face substantial reductions, putting the wellbeing of Americans who rely on the programs at risk.

AMERICANS ARE NOT CONFIDENT THAT SOCIAL SECURITY AND MEDICARE WILL BE THERE FOR THEM
* 46 Percent Think Social Security Probably Or Definitely Will Not Be There For Them When They Retire. (“Bloomberg News National Poll,” Bloomberg, 6/5/13)

* 42 Percent Think Medicare Probably Or Definitely Will Not Be There For Them When They Retire. (“Bloomberg News National Poll,” Bloomberg, 6/5/13)

NOR ARE THEY CONFIDENT THAT THE PROGRAMS WILL BE ENOUGH TO HELP TO HELP COVER THEIR EXPENSES
* 70 Percent Are Just Somewhat Confident Or Not Confident That Social Security Will Be Enough To Help Cover Their Expenses. (“Bloomberg News National Poll,” Bloomberg, 6/5/13)

* 68 Percent Are Just Somewhat Confident Or Not Confident That Medicare Will Be Enough To Help Cover Their Expenses. (“Bloomberg News National Poll,” Bloomberg, 6/5/13)

ANNUAL SOCIAL SECURITY AND MEDICARE COSTS ARE EXPECTED TO GROW EVEN FASTER THAN THE BURGEONING FEDERAL BUDGET
* Compound Annual Growth Rate Of The Federal Budget (2012-2022): 4.74%. (“Updated Budget Projections: Fiscal Years 2013 To 2023,” Congressional Budget Office, 5/14/13)

* Compound Annual Growth Rate Of Social Security Costs (2012-2022): 6.16%. (“The 2013 OASDI Trustees Report,” OASDI Trustees, 5/31/13)

* Compound Annual Growth Rate Of Medicare Costs (2012-2022): 7.10%. (“The 2013 Medicare Trustees Report,” CMS, 5/31/13)

WHAT WOULD IT LOOK LIKE IF THE SOCIAL SECURITY AND MEDICARE TRUST FUNDS WERE DEPLETED?
* The Social Security Disability Insurance Trust Fund Would Only Be Sufficient To Pay 80 Percent Of Benefits In 2016. “Legislative action is needed as soon as possible to prevent depletion of the DI Trust Fund reserves in 2016, at which time continuing income to the DI Trust Fund would be sufficient to pay 80 percent of DI benefits.” (“The 2013 OASDI Trustees Report,” OASDI Trustees, 5/31/13)

* The Medicare Hospital Insurance Trust Fund Would Only Be Sufficient To Pay 87 Percent Of Claims In 2026. “Under current law, scheduled HI tax income would cover only 87 percent of estimated expenditures in 2026 and 71 percent in 2050.” (“The 2013 Medicare Trustees Report,” CMS, 5/31/13)

* The Combined Social Security Old-Age, Survivors, And Disability Insurance Trust Fund Would Only Be Sufficient To Pay 77 Percent Of Benefits In 2033. “Alternatively, solvency could be maintained if benefits were reduced to the level that would be payable with scheduled tax rates and earnings subject to tax in each year beginning in 2033. At the point of trust fund reserve depletion in 2033, this would be equivalent to a reduction in all scheduled benefits of 23 percent, with reductions reaching 28 percent in 2087.” (“The 2013 OASDI Trustees Report,” OASDI Trustees, 5/31/13)

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