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Trustees Warn of Looming Cuts to Social Security, Medicare as Trust Funds Dwindle

July 1, 2025

The Social Security and Medicare programs face imminent financial shortfalls, with both trust funds projected to be depleted by 2033, after which recipients would receive reduced benefits. According to the 2025 Trustees Report, the Old-Age and Survivors Insurance Trust Fund will only be able to pay 77% of scheduled benefits after 2033, while Medicare's Hospital Insurance Trust Fund would pay 89% of benefits upon depletion. Contributing factors include the repeal of certain provisions, slower fertility rates, and decreasing labor compensation as a share of GDP.

Who is affected

  • Social Security recipients (current and future)
  • Medicare beneficiaries
  • Social Security Administration workforce (facing 12% reduction)
  • American taxpayers and citizens who rely on these programs
  • Individuals subject to the now-repealed Windfall Elimination Provision and Government Pension Offset

What action is being taken

  • The Social Security Administration is cutting approximately 12% of its workforce
  • House Speaker Mike Johnson and Republicans are developing plans to address entitlement program spending
  • Advocacy groups like Social Security Works are speaking out against potential cuts and service reductions
  • The Committee for a Responsible Federal Budget is calling for Congressional action

Why it matters

  • Recipients would receive only 77% of Social Security benefits after the OASI fund depletion in 2033
  • Medicare would pay only 89% of benefits after its Hospital Insurance fund is depleted in 2033
  • The combined Social Security funds would pay only 81% of scheduled benefits after depletion in 2034
  • The workforce reduction at the Social Security Administration is causing service delays
  • The programs represent critical financial support for millions of Americans, particularly retirees
  • These issues affect nearly three-quarters (73-74%) of federal government spending

What's next

  • No explicit next steps stated in the article

Read full article from source: The San Diego Voice & Viewpoint