New Social Security Trustees Report Forecasts Sooner-Than-Expected Shortfalls

On Friday, the Social Security and Medicare Boards of Trustees released their annual report on the status of the two largest federal programs.

The 2011 Trustees Report warns that “projected long-run program costs for both Medicare and Social Security are not sustainable under currently scheduled financing, and will require legislative modifications if disruptive consequences for beneficiaries and taxpayers are to be avoided.”

Recommending that the government acts sooner rather than later to correct the speedy erosion of Social Security and Medicare funds, the Board of Trustees said that as much time as possible is needed to negotiate change and minimize the potential negative impact on low-income and aging citizens.

If the programs continue as is, Social Security will experience a shortage in 2036, while Medicare’s hospital insurance trust fund will run out of money in 2024–five years earlier than the 2010 report foretold.

The report attributes the gloomy forecast to the recession but also to a bit of positive news: Americans are living longer. Men who turn 65 in 2010 are now expected to live another 18.6 years–up an extra half-year compared to last year’s report. Likewise, life expectancy for women who turn 65 in 2010 is projected at 20.7 years–up .3 years from 2010.

“Americans are living longer, and health care costs are continuing to rise,” said Treasury Secretary Timothy Geithner. “And if we do not do more to contain health care costs, our commitments will become unsustainable.”

Read a summary of the full report here.

Are you concerned about Social Security and Medicare funds drying up?

If you need help with your Social Security benefits, contact the Social Security Disability lawyers at Fleschner, Stark, Tanoos & Newlin.