Medicare’s finances got a slight upgrade in a new report from the program’s trustees, while Social Security’s were similar to last year’s projections.
Social Security’s combined trust funds will run dry in 2034, while Medicare’s hospital insurance fund will be exhausted in 2029, the trustees who oversee the benefit programs said Thursday in an annual report.
The latest report, the first during the Trump administration, paints a mildly better picture for Medicare. Last year, trustees said Medicare’s trust fund for hospital insurance would be exhausted in 2028.
Last year, Social Security’s trustees said the program’s two trust funds would be depleted by 2034.
In the report released Thursday, trustees said reserves for the fund that pays disability benefits would be exhausted by 2028. Combined with the fund that pays benefits to retirees, all Social Security reserves would be exhausted by 2034, they said.
Retirees would not see their benefits disappear in 2034, however. At that point, the program would have enough tax revenue coming in to pay about three-quarters of benefits, the trustees said.
The latest report arrives as President Donald Trump and congressional Republicans are working to repeal and replace President Barack Obama’s health-care law. A bill released by Senate Republicans Thursday retained a payroll tax increase of 0.9% on wealthy Americans, to help finance Medicare.
Trump has said he will not cut Social Security or Medicare. However, his proposed budget would cut Social Security disability benefits by about $70 billion over the next 10 years.
Treasury Secretary Steven Mnuchin said in a statement that the Trump administration will focus on strengthening the economy to help make both programs sustainable in the future. “Compounding growth will help ease projected shortfalls,” he said.
Together, Social Security and Medicare accounted for 42% of federal program spending in fiscal year 2016.
