Trust Funds Closer to Depletion According to Latest Projections
WASHINGTON, May 12 /PRNewswire-USNewswire/ -- The 2009 Social Security and Medicare trustees' reports issued earlier today highlight the imperative to act immediately to address the challenges facing Social Security and Medicare, according to the American Academy of Actuaries.
The financial condition of the nation's retirement programs has deteriorated further during the past year and inaction will only make future efforts to restore the programs' financial viability more extreme and burdensome to future generations. These findings should spur all stakeholders to reexamine their positions on reforms to these programs and to act in an objective, nonpartisan way to resolve these solvency concerns.
"Medicare's future is threatened by large and imminent financial challenges," said Cori Uccello, the senior health fellow for the American Academy of Actuaries. "The actuarial profession urges President Obama and Congress to act now to restore Medicare's long-term solvency and sustainability."
The actuaries said the most immediate concern is the looming insolvency of the Medicare trust fund used to cover in-patient hospital services. The fund is financed through dedicated payroll taxes, and these revenues will fall below spending levels this year. Trust fund assets are projected to be depleted by 2017, two years earlier than previous projections. At that point, payroll tax revenue is projected to cover only about 81 percent of costs and even less thereafter.
Additionally, increasing health care spending will cause Medicare to consume ever-growing shares of both the federal budget and the overall economy, threatening its long-term sustainability. Medicare spending was 3.2 percent of the nation's economy in 2008, accounting for about one in every six federal revenu
|SOURCE American Academy of Actuaries|
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