Medicare and Social Security go-broke dates pushed up due to rising health care costs, new SSA law
WASHINGTON (AP) — The go-broke dates for Medicare and Social Security 's trust funds have moved up as rising health care costs and new legislation affecting Social Security benefits have contributed to earlier projected depletion dates, according to an annual report released Wednesday.
The go-broke date — or the date at which the programs will no longer have enough funds to pay full benefits — was pushed up to 2033 for Medicare's hospital insurance trust fund, according to the new report from the programs' trustees. Last year's report put the go-broke date at 2036.
Meanwhile, Social Security's trust funds — which cover old age and disability recipients — will be unable to pay full benefits beginning in 2034, instead of last year's estimate of 2035. After that point, Social Security would only be able to pay 81% of benefits.
The trustees say the latest findings show the urgency of needed changes to the programs, which have faced dire financial projections for decades. But making changes to the programs has long been politically unpopular, and lawmakers have repeatedly kicked Social Security and Medicare's troubling math to the next generation.
President Donald Trump and other Republicans have vowed not to make any cuts to Medicare or Social Security, even as they seek to shrink the federal government's expenditures.
'Current-law projections indicate that Medicare still faces a substantial financial shortfall that needs to be addressed with further legislation. Such legislation should be enacted sooner rather than later to minimize the impact on beneficiaries, providers, and taxpayers,' the trustees state in the report.
About 68 million people are enrolled in Medicare, the federal government's health insurance that covers those 65 and older, as well as people with severe disabilities or illnesses.
Wednesday's report shows a worsening situation for the Medicare hospital insurance trust fund compared to last year. But the forecasted go-broke date of 2033 is still later than the dates of 2031, 2028 and 2026 predicted just a few years ago.
Once the fund's reserves become depleted, Medicare would be able to cover only 89% of costs for patients' hospital visits, hospice care and nursing home stays or home health care that follow hospital visits.
The report said expenses last year for Medicare's hospital insurance trust fund came in higher than expected.
Income exceeded expenditures by nearly $29 billion last year for the hospital insurance trust fund, the report stated. Trustees expect that surplus to continue through 2027. Deficits then will follow until the fund becomes depleted in 2033.
The report states that the Social Security Social Security Fairness Act, enacted in January, which repealed the Windfall Elimination and Government Pension Offset provisions of the Social Security Act and increased Social Security benefit levels for some workers, had an impact on the depletion date of SSA's trust funds.
Social Security benefits were last reformed roughly 40 years ago, when the federal government raised the eligibility age for the program from 65 to 67. The eligibility age has never changed for Medicare, with people eligible for the medical coverage when they turn 65.
Nancy Altman, president of Social Security Works, an advocacy group for the popular public benefit program said in a statement that 'there are two options for action: Bringing more money into Social Security, or reducing benefits. Any politician who doesn't support increasing Social Security's revenue is, by default, supporting benefit cuts.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
28 minutes ago
- Yahoo
South Korea Plans $22 Billion Extra Budget as Tariffs Hit Growth
(Bloomberg) -- South Korea unveiled an extra budget worth billions of dollars, in a bid to support an economy struggling with sluggish consumption and mounting trade headwinds from Donald Trump's tariffs. Security Concerns Hit Some of the World's 'Most Livable Cities' JFK AirTrain Cuts Fares 50% This Summer to Lure Riders Off Roads Taser-Maker Axon Triggers a NIMBY Backlash in its Hometown How E-Scooters Conquered (Most of) Europe NYC Congestion Toll Cuts Manhattan Gridlock by 25%, RPA Reports The 30.5 trillion won ($22.2 billion) proposal includes 15.2 trillion won for economic stimulus and 5 trillion won for supporting livelihoods like small businesses, the finance ministry said in a statement. Another 10.3 trillion won is set aside to cover revenue shortfall for this year's existing budget, as taxation income fell due to weaker corporate performance and consumer spending. The proposal comes after President Lee Jae Myung took office earlier this month, vowing to boost growth and improve livelihoods. He had pledged over 30 trillion won in fresh spending through extra budgets to support small businesses and offset trade shocks. Before the election, 13.8 trillion won had already been approved as part of the first supplementary budget. Lee has inherited an economy already under pressure from weakening demand, compounded by months of political turmoil triggered by former President Yoon Suk Yeol's failed martial law bid. The country's gross domestic product shrank in the first quarter, prompting the Bank of Korea to slash its 2025 growth forecast to 0.8% from 1.5%. The central bank also cut its key interest rate to 2.5% and signaled more easing may follow. Of the 10.3 trillion won tax revenue shortfall, nearly 9 trillion won stemmed from declines in corporate and value-added taxation income. The figures point to deepening economic strain, and help explain why policymakers are leaning more heavily on fiscal stimulus. As a leading semiconductor manufacturer and a key player in global supply chains, South Korea remains particularly vulnerable to trade risks from US tariffs. Exports are equivalent to more than 40% of the country's GDP, and are a key driver of the the country's growth rate. Trump's across-the-board tariffs for South Korea, which are set to jump to 25% in early July from a baseline 10%, are among the highest imposed on US allies. Other sector-specific levies by the Trump administration threaten key South Korean industries, including semiconductors, cars, steel, and aluminum. 'Bold and timely fiscal support is essential for the economy to return to a solid upward trajectory,' second Vice Minister of Finance Lim KiKeun said in a briefing Wednesday. 'While the supplementary budget cannot solve all challenges at once, it represents the first crucial step forward.' The government plans to fund the extra budget through a mix of spending cuts and debt issuance. About 5.3 trillion won will come from restructuring existing outlays, while 2.5 trillion won will be drawn from surplus balances in public funds. Another 3 trillion won will come from changes to foreign exchange stabilization bonds, while the bulk — 19.8 trillion won — will be financed through new sovereign bond sales. The fiscal push will raise the nation's debt-to-GDP ratio to 49% this year, from 47.4% in 2024, as total government spending climbs 6.9%, the ministry said. Even before the election, the need for more fiscal stimulus was clear. BOK Governor Rhee Chang-yong warned that additional measures would likely be required in 2025, underscoring the challenges facing Asia's fourth-largest economy. As part of the stimulus package, the government plans to distribute vouchers worth between 150,000 and 500,000 won per person. The payments will be provided to the general population rather than targeted groups. The issuance of regional gift certificates will also be expanded to encourage spending, with policymakers hoping the combined measures will deliver a swift injection of cash into the real economy. The proposal still needs parliamentary approval, and opposition lawmakers have raised concerns about the rapid debt buildup and potential inefficiencies in spending. Song Eon-seog, a lawmaker from the People Power Party, warned that 'reckless extra budgets' could actually harm both livelihoods and the broader economy. Earlier this month, the central bank stressed the importance of swiftly drafting and implementing an extra budget to boost domestic demand, saying the stimulus would have only a limited impact on inflation. --With assistance from Seyoon Kim and Shinhye Kang. Ken Griffin on Trump, Harvard and Why Novice Investors Won't Beat the Pros Is Mark Cuban the Loudmouth Billionaire that Democrats Need for 2028? The US Has More Copper Than China But No Way to Refine All of It How a Tiny Middleman Could Access Two-Factor Login Codes From Tech Giants Can 'MAMUWT' Be to Musk What 'TACO' Is to Trump? ©2025 Bloomberg L.P. Sign in to access your portfolio
Yahoo
32 minutes ago
- Yahoo
Lt. Gov. Patrick, Sen. Perry tout legislative victories in Lubbock stop
While touring major cities in Texas to highlight wins and local impacts stemming from the 89th Texas Legislature, Lt. Gov. Dan Patrick made a pit stop in Lubbock on Tuesday. Joined by Sen. Charles Perry, R-Lubbock, both touted major wins for Texas — Perry's water bill and funding for public school and school choice, among others. Others are reading: Texas House Speaker Burrows discusses water, school choice and small business priorities However, something was also unique about this visit since the speaker of the Texas House — Dustin Burrows — is also the representative of Lubbock and has to work closely with the governor and lieutenant governor during session. "I've worked with four speakers now," Patrick said. "This was, this was light years above any other relationship." Patrick said that from day one, Burrows was in constant contact with him and the governor, and the three even reinstated what had been an abandoned tradition known as the Big Three Breakfast. Story continues after the gallery. But even outside of the breakfast, Patrick said he and Burrows met on a constant basis, where agreements on legislation were made. "When we had an issue, we sat down and worked it out — like the property tax issue to go to the level we went to a $200,000 homes exemption to eliminate school taxes for seniors," Patrick said. "He and I decided that in a 10-minute conversation, on a handshake." Patrick also said the two of them had to work on complicated bills during the session — several of which have a direct impact on West Texas. School funding for public schools and private schools drew in vocal critics around the state for and against the bills. One of those bills, as previously mentioned, was raising the homestead exemption to $200,000 for those over the age of 65. "For those of you under 65, your homestead exemption is now $140,000, meaning your school taxes will be down about 50% from where they were just several years ago," Patrick said. Those exemptions provide property tax relief, but they also impact the funding for public schools like Lubbock, Lubbock-Cooper, and Frenship ISDs in a different way. "When we cut your property taxes, we're not decreasing money from our public schools," Patrick said. "We're actually writing a check in your place." This lends itself to an $8.5 billion investment in public schools, which Patrick said the state legislature did differently this time around. "This time, Republicans and Democrats joined together almost unanimously to say, we want to put it in buckets, and the biggest bucket is prioritizing teachers," Patrick said. "They're the most important person in the school, because they're the ones who educate their child. We need to pay teachers more, and we've been doing that in the Texas Senate for the last five years." Dig Deeper: Private school vouchers are now law in Texas. Here's how they will work. Patrick said that when considering a more rural focus on this topic, lawmakers wanted to make strides in closing the $10,000 gap between rural teachers' pay and that of teachers in urban centers. It was also through working with Burrows in the House that the Senate was able to pass its school choice framework. Patrick even addressed those concerned that the school choice funding would degrade public schools, arguing that it won't. "To give you a comparison, school choice takes no money from public schools." Patrick said. "It's a billion-dollar program, a separate fund for 100,000 kids per year over here. Public schools — five and a half million kids, compared to 100,000 and about $44 billion a year, compared to $1 billion. It does not impact public schools." "We collectively will leave this session with a $20 billion commitment going forward, plus the $2.5 billion in the base budget and a billion last session," Perry said. "So we have put $23.5 billion for one of the biggest issues the state Texas faces, and that's dependable, perpetual water supply to meet the growing state needs." But the investment in Texas's water security doesn't stop there. Perry said Texans will have a chance to approve House Joint Resolution 7, which proposes an additional billion dollars to the Texas water fund from state sales taxes. Others are reading: Texas farmers face mounting expenses as droughts worsen That amendment, along with 17 other proposed amendments, will be on the November 2025 ballot. Perry also said rural Texas was able to secure a $90 million grant for emergency medical ambulance services, noting the need for rural communities to transport hurt or sick individuals to hospitals. "Rural Texas did well," Perry said. "Rural Texas — just like some of the initiatives we did in previous session, and what we continue to do this session, has never been better. Big, big wins in rural Texas." Mateo Rosiles is the Government & Public Policy reporter for the Lubbock Avalanche-Journal. Got a news tip for him? Email him: mrosiles@ This article originally appeared on Lubbock Avalanche-Journal: Lt. Gov. Patrick touts legislative water bill, school funding, taxes
Yahoo
38 minutes ago
- Yahoo
Tried and tested in war: For European drone manufacturers, Ukraine is the place to be
LE BOURGET, France (AP) — About once a month, French drone manufacturer Henri Seydoux makes what has become a necessary pilgrimage for many in his business — he goes to Ukraine. Because for drone technology, there is no harder place to survive than the frontlines of the war against Russia's invasion, where both sides are using unmanned aerial machines of all shapes and sizes to kill and to observe, reshaping modern warfare. And because the battlefields also bristle with electronic countermeasures and weapons to confuse, jam and shoot down drones, Ukraine has also become an extreme real-life proving ground for advances in drone technology, some of which has started to spill over into non-military sectors. For manufacturers, being able to say that their drones and related equipment have been battle-tried and tested by Ukrainian forces is becoming a sales pitch as they market their wares not just to national defense departments, but also to police forces, border authorities, rescue services and civilian users. 'When we say, 'This is a good machine, it works,' people can believe us or not. But when it's guys in Ukraine and others saying they're happy, it has greater value," says Bastien Mancini, president and co-founder of French drone manufacturer Delair, which has teamed up with European defense contractor KNDS to supply Ukrainian forces with 100 exploding drones. KNDS' sales literature notes that they are 'combat-proven." Mancini says civilian users of Delair's other non-military drones 'see things that work in Ukraine and say to themselves, 'It resists jamming, it resists the loss of a radio connection and whatnot and so it's going to be fine for civilian use, like inspecting electric cables or whatever." 'It really has helped us win markets. It gives people confidence," he told The Associated Press at the Paris Air Show, a major shop-window for the aviation and defense industries. 'Drones saved Ukraine' Henri Seydoux, the founder and head of French drone maker Parrot, says Ukraine is 'fascinating' from a drone-technology perspective because 'it changes so quickly, there are new ideas non-stop.' He's been making regular trips since the start of Russia's full-scale invasion in February 2022 to meet Ukrainian drone manufacturers, drone software developers and the military authorities. 'Every quarter, the situation changes completely,' he said in an interview. 'Every company, let's say, that makes military equipment or every army is very interested by drones. But the ones that really use them and understand how to use them is the Ukrainians." For Ukraine, trying to defend against swarms of Russian drones that target cities and waves of drone-supported Russian troops is a matter of survival. So, too, is finding workarounds to counter electronic warfare systems that Russia deploys to jam and disable Ukrainian drones, igniting what has become a drone-technology arms race between the two sides and for manufacturers outside of Ukraine, too. Small drones that drop bombs and explode against targets — mass-produced at a fraction of the cost of other more complex weapons systems that its allies have supplied — have become increasingly vital for Ukraine's resistance. Its Defense Ministry has said that it plans to buy 4.5 million drones this year, all Ukrainian-made, that allow their operators to see what the machines see, so they can guide the flights in real time — exploding in a Russian trench, for example, or even against a single enemy soldier. That's three times more drones than the ministry bought last year, it says. 'Drones saved Ukraine,' said Alex Vorobei, the Ukrainian sales representative for Ailand Systems, a Ukrainian start-up developing a drone that detects land mines. Vorobei and others in the drone business say that manufacturers not involved in Ukraine risk being left behind. 'If you're in the defense field and still not in Ukraine, it means you are nowhere," Vorobei said at the Paris show. Civilian uses for Ukrainian lessons A micro surveillance drone unveiled by Parrot at the Paris show has a nod to Ukraine in its name — the Anafi UKR — and also has been field-tested in what Seydoux describes as the 'very harsh environment' on the frontline. It's equipped with artificial intelligence technology to enable it to find its way when radio and navigational signals are jammed. Parrot says the drone's ready-for-war resilience and features also make it a good fit for law enforcement operations, such as monitoring crowds, tracking suspects or keeping watch over borders, and for rescue services in remote areas or during fires and accidents when navigational signals might go down. Ukraine has been 'a real laboratory or test for us, to see if our products worked,' said Delair's Mancini. Its Oskar exploding drone, which has polystyrene wings, carries a half-kilogram (one pound) warhead to detonate against troops and lightly armored vehicles. Delair developed it in under a year, repurposing one of its civilian drones that was already used in France for mapping and inspecting power cables, and hardening it for Ukraine with technology to resist Russian jamming. "Five or 10 years ago, lots of people were asking themselves, 'Are drones really useful for something?' No one is asking that question today," he said. ___ Associated Press writer James Brooks in Odense, Denmark contributed to this report.
