Aging workforce straining Social Security, Medicare
An aging population and an economy slow to rebound are straining the long-term finances of the government's two largest benefit programs, Social Security and Medicare. Those problems are getting new attention today as the trustees overseeing the massive programs release their annual financial reports. Medicare is in worse shape than Social Security because health care costs have been rising so rapidly. But both programs are on a path to insolvency in the coming decades, unless Congress acts, according to the trustees. Last year, the trustees projected the Medicare hospital insurance fund for seniors would run out of money in 2024. Social Security's retirement fund was projected to run dry in 2038, while the disability fund was projected to be drained by 2018. New projections in March gave a more dire assessment of the disability program, which has seen a spike in applications as more disabled workers lose jobs and apply for benefits. The nonpartisan Congressional Budget Office now says the disability fund would run out of money in 2016. Social Security's trustees are again urging Congress to shore up the disability system by reallocating money from the retirement program, just as lawmakers did in 1994. If the Social Security and Medicare funds ever become exhausted, both programs would collect only enough money in payroll taxes to pay partial benefits, the trustees say. "I don't know how to make it clear to the public, but in my mind the sirens are going off," says Mary Johnson, policy analyst for the Senior Citizens League. "I wouldn't say we're under attack, but we are in a very, very serious position." The Associated Press has the full story here.
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