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With the future of Social Security and Medicare in question, a new report has found that both programs could be on track to run out of money over the next decade.
The report, released by the trustees of Medicare and Social Security, revealed that both programs are expected to soon begin to run a deficit, as the cost of benefits outpaces the revenue generated from taxes and premiums.
The Social Security program is projected to begin running a deficit in 2034, and the Medicare Hospital Insurance Trust Fund is projected to become insolvent in 2026.
The trustees’ report also showed that the Social Security and Medicare trust funds will be exhausted by 2035 and 2028, respectively.
This news comes after years of warnings that the programs could be on course for insolvency. The report said that the Social Security program has not seen any substantial changes since 1983, and that the Medicare program has not seen any significant reforms since 1989.
While the report did not make any specific recommendations, it did note that the longer Congress waits to take action, the more drastic the changes that will need to be made.
The report said that Congress should consider a variety of options, including increasing payroll taxes and raising the retirement age. It also suggested that Congress consider reducing benefits, or increasing taxes on high-income earners.
The report also warned that any changes to the programs should be done in a way that is fair and equitable, and that the changes should not overly burden any one group or generation.
The news of the potential insolvency of Social Security and Medicare has been met with concern from many, as the programs are vital to the financial security of millions of Americans. While the report serves as a warning to lawmakers, it is up to Congress to decide what to do about the situation.