As baby boomers age and life expectancy rises another expected 15%, the number of participants in Social Security and Medicare from 2027 to 2036 is projected to continue growing faster than the overall population, the Congressional Budget Office said in a new report.
At the same time, CBO said, "federal health care costs per beneficiary are projected to continue growing faster than GDP per capita."
As a result of the two trends, "outlays for Social Security and Medicare are projected to rise in relation to GDP, increasing from 8.7% of GDP in 2027 to 10.1% in 2036," CBO states.
Beyond the projected period, the aging of the population and rising health care costs will continue to put pressure on the federal budget, according to CBO.
The answer: "bring more revenue into these programs in a fair and long overdue way, where the wealthy contribute their fair share," Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare, told ThinkAdvisor in an email Thursday. "Cutting benefits for an aging population is not the answer."
CBO's findings "are not surprising," Nancy Altman, president of Social Security Works, added in another email. "Social Security and Medicare's trustees have known for decades that spending would increase as the Baby Boom generation aged. One of the best ways to address this would be to welcome more talented, hard working immigrants from around the world. Unfortunately, the Trump administration is doing the exact opposite, and slamming our nation's doors shut."
Added Richtman: "An aging population is not responsible for higher deficits."
The CBO, Richtman continued, "cites the passage of Trump's 'Big, Beautiful Bill' as a key contributor to increasing federal debt. According to CBO, the tax cuts in the bill will add $4.7 trillion to the debt over ten years."
He added: "Before we scapegoat older people for rising debt or economic insecurity, it should be noted that Americans over 50 years of age contribute an estimated $8.3 trillion to U.S. GDP through spending, employment, and volunteerism. That figure is expected to rise to $26.8 trillion by 2050. They also support roughly 88.6 million jobs."
Health care costs "are out of control," Altman relayed, "but this is not specific to Medicare. Compared to other wealthy nations, Americans spend more on health care and get worse outcomes. The solution is to improve Medicare and expand it to cover everyone in America, so that the focus is on patients instead of profits."
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