After the Social Security and Medicare Boards of Trustees’ annual reports were released, Senate Finance Committee Chairman Orrin Hatch (R-Utah) called for strong presidential leadership to confront an unsustainable financial future in the Medicare and Social Security programs that will affect the well-being of the nation’s retirees and urged bipartisan reforms.
The reports, which were drafted only by trustees within the Obama Administration this year, followed a speech delivered by Hatch on Democrats’ accusations that a pending Obama nominee to the trustee board has, in the past, overstated the financial challenges facing Social Security.
In response to the reports, Hatch issued the following statement:
“As our population ages and our citizens live longer lives than ever, our nation’s two most important entitlement programs are poised to face increased financial pressure that risk the wellbeing and health of our seniors present and future. Today’s reports are a stark reminder about the significant financial challenges facing our entitlement programs and demonstrate how little has changed to improve and reform Medicare and Social Security’s retirement program under the Obama Administration. While this provides further evidence that the board of trustees is free from political bias, as some in Congress are alleging, it nonetheless underscores the need for strong, bipartisan leadership to produce real results for America’s seniors. What these reports do reflect, however, are the reforms to Social Security’s disability insurance program last year, which were crafted in a Republican controlled Congress. Our action averted cuts to disabled American workers’ benefits that otherwise would have occurred, and I am hopeful similar entitlement reform efforts will be embraced by leaders in Washington moving forward.”
A summary of the reports is listed below:
- The Medicare Hospital Insurance (HI) or “Part A” trust fund will be exhausted in 2028 – two years earlier than projected in last year’s report.
- Assuming current law remains unchanged, Medicare’s total Part A unfunded obligation over 75 years is $3.6 trillion – a marked increase of 20% over last year’s value of $3.0 trillion.
- The Disability Insurance (DI) trust fund will be exhausted in 2023—seven years later than projected in last year’s report and a reflection of work by the Republican controlled Congress to avert DI benefit cuts.
- The Old-Age and Survivor (OASI) trust fund will be exhausted in 2035—the same as last year’s report.
- The 75-year open group unfunded obligation in Social Security is $11.7 trillion—$700 billion more than in last year’s report.
- The infinite horizon open group unfunded obligation in Social Security is $32.1 trillion—$6.3 trillion more than in last year’s report.