Pandemic Accelerates Depletion of US Social Security Trust Funds – Treasury
WASHINGTON, Aug.31 (Reuters) – The coronavirus pandemic will result in the depletion of key US Social Security trust fund reserves in 2033, a year earlier than an estimate made a year ago, when a strong Declining employment has reduced income, according to the US Treasury said Tuesday.
The Treasury said the Old Age and Survivors Trust Fund, which pays retirement benefits, would be able to pay 76% of benefits expected after 2033 from ongoing tax revenues.
Social Security’s separate disability insurance trust fund will see its reserves depleted in 2057, eight years earlier than last year’s estimate. Together, the two Social Security trust fund reserves will be depleted in 2034, a year earlier than the estimate made a year ago, the Treasury said.
Medicare Hospital Insurance Fund reserves are expected to be depleted in 2026, as estimated last year. This will allow Medicare to pay only 91% of the planned “Part A” hospital and other benefits of expected income at that time, the Treasury said.
Part of the reason for the stable exhaustion date is the higher death rate from COVID-19, which reduces some long-term care costs, offset by higher expected health costs for those weakened by the virus , said an official from the Department of Health and Social Services. journalists.
The annual reports on the Social Security and Medicare trust funds have again indicated that congressional action will be needed in the coming years to financially support the programs, increasing incomes, reducing benefits or by making other savings.
A further twist on this year’s Social Security report is an estimated 3.1% cost of living upward adjustment for benefits in 2021, the highest in a decade, due to higher inflation rates. high levels caused in part by supply shortages during the pandemic.
Reporting by David Lawder Editing by Chris Reese and Bill Berkrot
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