Social Security Trustees Say Retirement Fund Will Run Out by 2032: What to Know

Medicare is also projected to run out of funds sooner than previously anticipated. Medicare Part A will be able to cover scheduled benefits until the second quarter of 2033, according to the report, which is a quarter earlier than last year’s forecast. Past that point, Medicare will be able to cover 89% of scheduled Part A benefits. Those benefits typically cover inpatient hospital care, hospice care, limited skilled nursing facility care, and some home health services.

Medicare Part B, which covers doctor visits, outpatient and preventive care, medical equipment, and mental health services, and Part D, which covers prescription medications and certain vaccines, are not affected as they are funded by beneficiary premiums and federal government contributions.

Advocates for expanding Social Security have called for Congress to direct more money into the program. Doing so could involve raising revenue for the program, such as by increasing the payroll tax rate, raising the wage cap, or applying Social Security taxes to forms of compensation that are currently exempt. Lawmakers could also reduce future benefits, such as by raising the full retirement age or slowing the annual growth of benefits, especially for higher income retirees.