Committee for a Responsible Federal Budget

June 2026 Event: Checking in on the Social Security & Medicare Trust Funds

The June 2026 Committee for Responsible Federal Budget event focused on the latest Social Security and Medicare trustees’ reports, which warn that the Old‑Age and Survivors Insurance (OASI) trust fund will be exhausted by the fourth quarter of 2032 and the Medicare Hospital Insurance fund by 2033. These dates mark the closest approach to insolvency in decades, underscoring an urgent fiscal challenge. Key drivers include a revised fertility assumption—down to 1.75 children per woman—alongside lower net immigration projections and modestly stronger near‑term economic outlooks. While the Disability Insurance fund remains fully funded, the combined OASDI actuarial balance now calls for a 4.42% payroll‑tax increase to sustain solvency through 2100, up from 3.82% a year earlier. The report also highlights that the long‑run deficit stems largely from fewer workers supporting a growing beneficiary base. Actuarial chief Karen Glenn emphasized that “it’s a simple math problem, a difficult political problem,” noting that without action, scheduled benefits could fall to 83% of promised levels by 2034 and 65% by 2100. Graphs presented showed the shrinking gap between income and cost, and the near‑term optimism from higher real earnings only temporarily offsets the structural shortfall. The implications are clear: Congress must act soon—ideally before 2032—to either raise payroll taxes by roughly a third, cut benefits by about a quarter, or adopt a mix of both. Delaying reforms risks reduced benefits, increased taxpayer burden, and heightened political pressure as the safety net approaches its limits.