Rep. Pat Tiberi (R-Ohio) said in a column published on Monday that Congress should act soon on finding solutions for the financially depleting Medicare and Social Security programs.
Tiberi was responding to the recently released 2013 Medicare and Social Security Trustees Report, an annual report mandated by the Social Security Act that requires the board of trustees for the Medicare program to report to Congress on the current and projected financial condition of the Medicare Hospital Insurance and the Supplementary Medical Insurance trust funds.
The report indicated that the Social Security Trust Fund would remain unchanged and the Medicare hospital insurance trust fund would be exhausted two years later than the trustees reported last year.
Headlines that interpret the results as “looking better” are wrong, Tiberi said, adding that people should not be “lulled into a false sense of security.”
“The bottom line is no matter how you interpret these findings, Medicare and Social Security are in trouble,” Tiberi said.
Tiberi, the chairman of the House Ways and Means Subcommittee on Select Revenue Measures, said Congress could prevent the inevitable financial problems in 2033 by addressing Social Security now.
“The sooner we get started on finding a realistic, workable solution, the more options we will be able to consider,” Tiberi said.
If Congress fails to act before 2033, Tiberi said benefits would be subject to an across the board 23 percent cut or workers and employers would see their payroll taxes increase from 12.4 percent to 16.5 percent.
If changes are made now, however, those currently entering the job market should have adequate time to adjust their retirement planning to take into account reforms for Social Security programs, Tiberi said. Addtionally, the increasing cost of health care in addition to demographics should also be a reason to be concerned about the future of Medicare and Social Security.
Tiberi dismissed the concept that such programs and benefits are paid for with payroll taxes that do not add to the federal deficit.
“In fiscal year 2012, after accounting for payroll taxes, Medicare premiums and other fees, there was still a cash flow deficit of $403 billion for Social Security and Medicare which had to be covered by general revenue from the U.S. Treasury and represented 37 percent of the overall federal deficit,” Tiberi said.
The House Ways and Committee is responsible for analyzing and inquiring the trustees about its findings. Hearings will be slated on its legislative calendar for early summer.