WASHINGTON -- Millions of Americans who rely on Social Security can expect to receive their biggest payment increase in years this January, according to projections released Thursday by the trustees who oversee the program.
But older Americans shouldn't get too excited.
The increase is projected to be just 2.2 percent, or about $28 per month for the average recipient. Social Security recipients have gone years with tiny increases in benefits. This year they received an increase of 0.3 percent, after getting nothing last year.
In some good news for senior citizens, the trustees project that Medicare Part B premiums will remain unchanged next year. Most beneficiaries pay $134 a month, though retirees with higher incomes pay more.
Both Social Security's cost-of-living adjustment and the Medicare Part B premium are to be announced in the fall.
The trustees released the 2018 projections Thursday, along with their annual warning about the long-term financial problems of Social Security and Medicare, the federal government's two bedrock retirement programs.
More than 61 million retirees, disabled workers, spouses and surviving children receive Social Security benefits. The average monthly payment is $1,253. Medicare provides health insurance to about 58 million people, most of whom are at least 65 years old.
Unless Congress acts, the trust funds that support Social Security are estimated to run dry in 2034, the same year as last year's projection. Medicare's trust fund for inpatient care is projected to be depleted in 2029, a year later than last year's forecast.
If Congress allows either fund to be depleted, millions of Americans living on fixed incomes would face steep cuts in benefits.
Neither Social Security nor Medicare faces an immediate crisis -- they both currently have surpluses. But the trustees warn that the longer Congress waits to address the programs' problems, the harder it will be to sustain Social Security and Medicare without steep cuts in benefits, big tax increases or both.
For example, in 2034, Social Security is projected to have a $546 billion shortfall, which would grow to more than $3 trillion in the first five years.
"Congress must act to ensure the long-term fiscal viability and sustainability and survival of Medicare and Social Security," said Health and Human Services Secretary Tom Price. "There are a great many ways that the situation can be addressed. The bottom line is that it must be addressed."
Republicans in Washington have long clamored to address the long-term financial problems of Social Security and Medicare, the largest benefit programs run by the federal government.
Over the years, House Speaker Paul Ryan, R-Wis., has insisted on overhauling the programs, proposing a voucherlike system for Medicare and calling for partially privatizing Social Security.
Now that Republicans control Congress and the White House, Ryan says he doesn't want to tackle Social Security. Instead, Republicans and the White House are focused on repealing and replacing former President Barack Obama's health care law.
President Donald Trump has promised not to cut Social Security or Medicare, though his budget proposal for next year would reduce Social Security's disability benefits by nearly $70 billion over the next decade. The savings would come from encouraging, and in some cases requiring, people receiving the benefits to re-enter the workforce.
Republicans, meanwhile, note that both programs face steep shortfalls as soon as their trust funds run out of money.
"With an aging population, our nation's most critical retirement programs -- Medicare and Social Security -- are feeling an increased financial squeeze that puts their future viability at serious risk," said Sen. Orrin Hatch, R-Utah, chairman of the Senate Finance Committee.
Over the past decade, Social Security and Medicare made up about 40 percent of federal spending, excluding interest on the debt -- and that share is projected to grow in the future, according to the nonpartisan Congressional Budget Office.
Fifty years ago, the two programs accounted for 16 percent of federal spending.
The programs are expanding in part because the U.S. is growing older.
In 1960, there were 5.1 workers for each person getting Social Security benefits. Today, there are about 2.8 workers for each beneficiary.
A Section on 07/14/2017