Government Admits Medicare Is Going Broke Faster Than Expected
A new report issued by government trustees revealed that Medicare is going broke faster than previously expected, with the program reaching insolvency within less than a decade.
The Associated Press reported Tuesday that an analysis of the health of Medicare and Social Security — described by the AP as “a sobering checkup on programs vital to the middle class” — revealed that Medicare would be insolvent in 2026, three years earlier than previously expected.
That’s when the massive trust fund used to pay in-patient medical bills will run out.
Medicare was previously expected to hit the wall in 2029. Social Security projections remain unchanged, although that program is expected to become insolvent in 2034.
Due to the dire health of the programs, the Trump administration will be required to submit a plan to fix them after it releases its budget next year. In a statement Tuesday, Treasury Secretary Steven Mnuchin was confident the administration could do it.
“The programs remain secure,” the statement said. Medicare “is on track to meet its obligations to beneficiaries well into the next decade.”
“However, certain long-term issues persist,” the statement added. “Lack-luster economic growth in previous years, coupled with an aging population, has contributed to the projected shortages for both Social Security and Medicare.”
However, writing at the Daily Wire, conservative pundit Ben Shapiro was unconvinced that the current political climate, combined with the dire shape of entitlement reform, would yield significant-enough changes to the foundering programs.
“Medicare and Social Security, along with Medicaid, represent a majority of the federal budget each year, and represent mandatory spending,” Shapiro wrote. “And Social Security has been running a negative cash flow for years. Our gigantic national debt number doesn’t include unfunded liabilities to these programs. According to some studies, if we include expected shortfalls from Medicare and Social Security in the debt, our debt is actually $90.6 trillion.
“And yet politicians of both parties — with the possible exception of Speaker of the House Paul Ryan (R-WI) — are utterly unconcerned with entitlement reform. In fact, they demagogue anyone who dares to mention entitlement reform. President Trump campaigned on the notion that he wouldn’t change entitlement programs. Democrats have created (advertisements) full graphics of Ryan pushing old ladies off cliffs to signify their opposition to changes to entitlements (reforms).”
While the departure of Ryan didn’t leave a single wet eye in our offices, one of the few things we could at least count on him for was to push entitlement reform. Without him, we wonder whether the next Republican leader in the House — we pray that it’s the speaker — has the stomach to tackle the issue.
If it’s another even more establishment-y hack, we fear whatever momentum or stomach existed for entitlement reform will be lost. This is the time for the Trump administration to start seriously making moves on Medicare and Social Security.
If it doesn’t, what’s going to happen — almost everyone can guarantee it with a kind of sickening certainty — is that we’re going to have to raise taxes. Other solutions posited by William Baldwin over at Forbes include means-testing and cutting out cost-of-living increases in Social Security. Both of these deserve serious consideration.
However, doing that without Republicans in control of both houses of Congress will be impossible — yet another reason why the administration needs to start leading with urgency.
Whatever the situation is, it’s become clear that we’ve kicked the can all the way down the road and we can see the dead end.
It’s time to act and stop bankrupting generations to come.
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