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Treasury: Social Security Broadly Funded Until 2033

Social Security Administration, Social Security, SSA

 (REUTERS)

Slower growth in healthcare spending is shoring up the funding outlook for the federal Medicare program that covers the hospital bills of the elderly, trustees of the program said on Monday.

The program's trust fund for hospital care will run out of money in 2030, the trustees said in a report. That was four years later than in their previous estimate. When the fund runs out of money, Washington would only be able to partially cover its obligations.

The trustees said the fund would last longer than previously though because "expenditures in 2013 were significantly lower than the previous estimate." The trustees said changes to Medicare under President Barack Obama's healthcare overhaul appeared to be creating "substantial savings."

At the same time, trustees for the country's Social Security program repeated their warning that Washington would run out of the money needed to fully pay disability benefits by 2016.

The report's conclusions largely mirrored those made earlier this month by the nonpartisan Congressional Budget Office, which also pushed back to 2030 its projection of when Medicare's main trust fund would be exhausted.

Depletion of the Medicare and Social Security trust funds does not mean that all benefits would stop. At the current rate of payroll tax collections, Medicare would be able to pay about 85 percent of costs in 2030, declining to 75 percent by 2050.

Social Security would be able to pay about 80 percent of disability benefits starting in "late 2016," the Treasury Department said in a statement. In 2033, the Social Security program would only have money to cover about three quarters of the pensions that it pays, Treasury said. (Reporting by Jason Lange and David Morgan; Editing by Andrea Ricci)

 

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