Two of the biggest entitlement programs that the U.S. Government is offering will be running out of funds in the future.
A report from The Fiscal Times stated that the trustees of the Social Security and Medicare trust fund have reported the projected dates on when the two programs would become insolvent.
The Social Security Disability Insurance fund is in immediate threat as the trust fund is set to run out of money by the end of 2016. A Congress approval to transfer funds from the retirement benefits into the Disability Insurance fund would provide it relief. The two funds, together, can pay beneficiaries the required benefits until 2034.
The Treasury Department said that about 81 percent of the Disability Insurance benefit will be paid starting in "late 2016," according to a report from Reuters.
By 2034, Social Security will only have enough money to pay about three-quarters of the pension it needs to cover.
The Hospital Insurance Trust Fund of Medicare, on the other hand, has enough money to pay benefits, at current levels, until 2030, according to The Fiscal Times.
The payout that beneficiaries will receive would decline to about 86 percent of the scheduled benefit after 2030. Other funds of Medicare, that covers Part B and Part D, remains to have money indefinitely as they are funded automatically. They are, however, becoming costly.
Reuters also reported that by 2050, payouts to beneficiaries would decline to about 80 percent of the scheduled benefit.
One of the trustees, Robert Reischauer, president of the Urban Institute and former head of the Congressional Budget Office, said that the public should not "focus on the date of trust fund depletion," according to The Financial Times.
"Focus on a more nuanced analysis of these reports," he said.
Reischauer stressed that the bottom line is that the current path of the two programs is fiscally unsustainable.
"The sooner lawmakers act, the less disruptive these unavoidable policy changes will be. Similarly, the sooner that lawmakers act, the broader will be the array of policy options that can be considered," he said in The Financial Times.
