Because we have talked about it so many times before on this blog, many of our more frequent readers are quite aware of the trouble facing the Social Security Administration’s trust funds than other residents across Illinois. As some of you already know, the rise in the number of baby boomers who need Medicare assistance has created a vacuum, allowing funds to leave the trust faster than they are coming in.
Although initial estimates were incredibly bleak, only giving the trust a few more decades before it would become depleted of all funds, new data suggests that the rise in health care costs may be slowing, adding valuable years to the Medicare trust and continued access to benefits for the elderly and disabled.
According to a report from Medicare and Social Security’s trustees, Medicare will be able to continue paying full benefits for its elderly and disabled beneficiaries, even without changes in the law, until 2030. That’s four more years than last year’s estimate. But as was stressed last year, Congress will need to act soon lest they risk the negative backlash for letting the trust run out.
One proposed solution, which was endorsed by the Treasury Secretary Jacob Lew, calls for more payroll tax revenue to be allocated to disability benefits. Although this would take away from Social Security’s old-age fund, which is scheduled to exhaust its reserves by 2034, it would help keep the disability trust afloat and give more time to draft and implement a well-thought out remedy to the problem at hand.
Source: The Wall Street Journal, “Medicare, Social Security Disability Fund Headed in Different Directions,” Damian Paletta, July 28, 2014