Social Security, Medicare Funds to Be Depleted Earlier Than Expected: Trustees

When Social Security funds get depleted, beneficiaries stand to lose about 20 percent of their scheduled benefits.

The Social Security Administration office building in Waycross, Ga., on Aug. 28, 2024. Madalina Vasiliu/The Epoch Times

Medicare and Social Security funds are now expected to drain out earlier than previous estimates, according to two reports released on June 18.

Social Security is made up of two trust funds—old-age and survivors insurance (OASI) and disability insurance (DI). The two are combined for analyzing the overall status of Social Security funds, referred to as the Old Age, Survivors, and Disability Insurance (OASDI) program.

The 2025 OASDI trustees report, published on June 18, states that the total cost of the Social Security program started exceeding its total income in 2021. Currently, the fund is projected to be depleted by 2034, a year earlier than last year’s expected date of 2035.

Following depletion, OASDI will only be able to pay 81 percent of scheduled benefits to its recipients.

“The Trustees recommend that lawmakers address the projected trust fund shortfalls in a timely way in order to phase in necessary changes gradually and give workers and beneficiaries time to adjust,” the report reads. “Implementing changes sooner rather than later would allow more generations to share in the needed revenue increases or reductions in scheduled benefits.”

At present, there are about 70 million Social Security beneficiaries in the United States. The program covers 185 million workers and their families.

The June 18 Medicare trustees report states that the program’s Hospital Insurance (HI) trust fund is expected to be depleted by 2033, three years earlier than the previous projection.

HI, also known as Medicare Part A, helps pay for inpatient hospital services, hospice care, skilled nursing facilities, and home health services after hospital stays.

HI’s income is projected to exceed expenses through 2027, following which it is expected to suffer deficits until the fund depletes in 2033.

The estimated depletion date was moved up “primarily due to the change in projected expenditures,” the report states, noting that costs over the short term are “projected to be higher than last year’s estimates.”

HI is one of the two trust funds powering Medicare, the other being the Supplementary Medical Insurance (SMI) trust fund. According to current estimates, the SMI trust fund is expected to be “adequately financed over the next 10 years and beyond.”

Medicare covered 67.6 million Americans last year, of whom 60.3 million were aged 65 and older, while 7.3 million were disabled.

Following the release of the Social Security and Medicare reports, Treasury Secretary Scott Bessent said the data stress the need for lawmakers to take action to ensure the long-term viability of these programs, according to a June 18 statement from the Department of the Treasury.

Dr. Mehmet Oz, administrator for the Centers for Medicare & Medicaid Services, said the Trump administration remains “fully committed to protecting and strengthening Medicare through responsible policies that preserve access to high-quality, affordable, patient-centered care while restoring long-term fiscal stability for taxpayers and future generations.”

Commissioner of Social Security Frank Bisignano said the financial status of Social Security trust funds “remains a top priority for the Trump Administration.”

Protecting Social Security, Medicare

In a June 18 statement, AARP, a nonprofit advocacy focusing on the interests of Americans aged 50 and older, raised concerns over the latest Social Security and Medicare fund depletion projections.

AARP CEO Myechia Minter-Jordan asked Congress to take action to “protect and strengthen the Social Security that Americans have earned and paid into throughout their working lives.” It is paramount that the Medicare program “remains financially strong for current and future generations.”

“AARP members and older Americans nationwide consistently say that the future of Social Security and Medicare are the issues they care about most, and they stand ready to hold politicians across party lines accountable to strengthen these programs for the long term,” she said.

The White House said in a March 11 statement: “The Trump Administration will not cut Social Security, Medicare, or Medicaid benefits. President Trump himself has said it (over and over and over again).”

Last month, the Office of Management and Budget released President Donald Trump’s fiscal year 2026 budget request to Congress, which includes preserving Social Security, according to a May 2 White House statement.

“The Budget supports the President’s promise to not touch Social Security benefits. It also includes sufficient resources for the Social Security Administration (SSA) to improve customer service by expanding and improving online services, and reducing customer wait times in field offices and on the phone,” the statement reads.

The “One, Big, Beautiful Bill,” backed by Trump, carries a provision that offers “historic tax relief to Social Security recipients” by cutting taxes on benefits received by seniors, the White House said in a May 16 statement.