The Washington Times is reporting that social security will pay out more this year than it gets in payroll taxes, marking the first time since the program will be in the red since it was overhauled in 1983, according to the annual authoritative report released Thursday by the program’s actuary.
Meanwhile President Obama’s health care overhaul has given Medicare’s basic Hospital Insurance an extra 12 years of financial stability, though it did not solve all of the program’s long-term challenges.
“The financial status of the HI trust fund is substantially improved by the lower expenditures and additional tax revenues instituted by the Affordable Care Act,” the program’s actuary said in its annual report. “These changes are estimated to postpone the exhaustion of HI trust fund assets from 2017 under the prior law to 2029 under current law and to 2028 under the alternative scenario.”
But the actuary said the programs’ finances are still troubled in the near and long terms, and warned that Congress is making things worse by putting off scheduled doctor fee cuts.
The social security deficit will last through 2011, but then will become revenue positive from 2012-2014, and then permanently exceed tax revenues beginning 2015, one year earlier than estimated in last year’s report.
Other highlights from the 2010 Annual Report to Congress include:
- The projected point at which the combined Trust Funds will be exhausted comes in 2037 – the same as the estimate in last year’s report. At that time, there will be sufficient tax revenue coming in to pay about 78 percent of benefits.
- The projected point at which tax revenues will fall below program costs comes in 2010. Tax revenues will again exceed program costs in 2012 through 2014 before permanently falling below program costs in 2015 — one year sooner than the estimate in last year’s report.
- The projected actuarial deficit over the 75-year long-range period is 1.92 percent of taxable payroll — 0.08 percentage point smaller than in last year’s report.
- Over the 75-year period, the Trust Funds would require additional revenue equivalent to $5.4 trillion in present value dollars to pay all scheduled benefits.