Overview

• The combined Social Security trust funds are now projected to run dry in 2034, one year earlier than last year’s forecast, threatening to cover only 81% of scheduled benefits thereafter.
• Medicare’s Hospital Insurance trust fund is expected to exhaust its reserves by 2033—three years sooner than previously estimated—leaving only 89% of Part A benefits payable without action.
• The bipartisan Social Security Fairness Act enacted in January 2025 is identified as the primary driver of the accelerated depletion by boosting benefits for over three million public-sector workers.
• Trustees cite delayed recovery in fertility rates and lower assumed wage-growth shares of GDP as key demographic factors worsening long-term financing.
• Absent congressional intervention through measures such as payroll-tax increases or benefit adjustments, automatic cuts of about 19% to Social Security and 11% to Medicare hospital benefits will take effect when trust funds deplete.