WASHINGTON -- Medicare's long-term health is starting to look a little better, the government said Friday, but both Social Security and Medicare are still wobbling toward insolvency within two decades if Congress and the president don't find a way to shore up the trust funds established to take care of older Americans.
Medicare's giant fund for inpatient care will be exhausted in 2026, two years later than estimated last year, while Social Security's projected insolvency in 2033 remains unchanged, the government reported.
An overall slowdown in health care spending is helping Medicare. Spending cuts in President Barack Obama's health care law are also having a positive impact on the balance sheet, but they may prove politically unsustainable over the long run.
The relatively good news about two programs that provide a foundation of economic security for nearly every American family is a respite, not a free pass. Program trustees urged lawmakers anew to seize a current opportunity and make long-term changes to improve finances. Action now would be far less jarring than having to hit the brakes at the edge of a fiscal cliff.
Politically, however, yesterday's positive report and the absence of a crisis could make legislative action less likely, especially in light of the lack of trust between President Barack Obama and Republicans in Congress. No end is in sight for the partisan standoff over what to do about Social Security and Medicare, two of the government's costliest programs, and the mammoth budget deficits they help fuel.
Social Security provides monthly benefit checks to about 57 million people, including 40 million retirees and their dependents, 11 million disabled workers and dependents and 6 million survivors of deceased workers. Medicare covers nearly 51 million people, mainly retirees but also disabled workers.
If the funds ever become exhausted, the nation's two biggest benefit programs would collect only enough money to pay partial benefits.
Social Security could cover only about 75 percent of benefits, while Medicare's fund for hospital and nursing rehabilitation care could pay 87 percent of costs.