Social Security and Medicare Funds At Risk Even Before Coronavirus [View all]

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Source: Associated Press

WASHINGTON (AP) -- The financial condition of the government's two biggest benefit programs remains shaky, with Medicare expected to become insolvent in just six years, while Social Security will be unable to pay full benefits starting in 2035, the government said Wednesday.

And that's before factoring what officials acknowledge will be a substantial hit to both programs from the coronavirus pandemic, which has shut down large parts of the U.S. economy and put millions of people out of work.

The depletion dates, which remained unchanged from last year's estimates, were revealed Wednesday with release of the annual trustees reports of both programs. When Social Security's reserves are exhausted in 2035, the program will only be able to pay 79% of benefits at that time.

Even if employment rebounds by the end of this year and payroll taxes return to near-normal levels, the shock from the pandemic shutdown could accelerate the depletion of the Social Security trust fund by about six months, officials told reporters...- More.


Read more: https://apnews.com/88109eff2df4c11c7d1d2937ca0134cb

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If a recession extends into 2021, a depletion would come a full year earlier. And the impact may be worse for the Medicare program, which in this report is estimated to deplete its reserves in 2026.

Economists project the expected recession will be the deepest since the 1930s, and it will see fewer people paying into Social Security and Medicare. Adding to the problem, the pandemic will impose heavier caseloads on the health program for those 65 and older.

Experts state that next year's report will be much more important because it will take into account the impact of pandemic.

So far more than 20 million workers have been laid off and they and their employers are no longer sending in payroll taxes to support Social Security retirement benefits and Medicare's giant trust fund for inpatient care...
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NOTE: HELPFUL INFO, socialsecurityworks.org
https://socialsecurityworks.org/