“What Happens When the Social Security Trust Fund Is Exhausted?,” by Mark J. Warshawsky and Andrew G. Biggs, American Enterprise Institute
“Social Security’s trust fund runs out in 2032, and Congress might not act in time to save it. The president would then have to step in, guiding Congress toward a longer-term reform. If Congress fails to act in time, should benefits be capped by level or according to personal wealth? Join AEI Senior Fellows Andrew G. Biggs and Mark J. Warshawsky as they present competing frameworks for how the executive branch could allocate benefit adjustments fairly when the trust fund hits zero. Marc Goldwein of the Committee for a Responsible Federal Budget will moderate this timely conversation on executive authority, retirement security, and what Washington should do as the clock runs out.”
LTC Comment, Stephen A. Moses, President, Center for Long-Term Care Reform:
This issue has ramifications for long-term care (LTC) financing that are rarely discussed. When Social Security benefits are cut Medicaid will lose a major source of LTC financing. That is because Medicaid recipients are required to contribute most of their income, most of which comes from Social Security, to offset Medicaid’s cost of their care. As Medicaid already pays dismally low reimbursements to nursing homes and home care agencies, loss of this outside source of “private” financing will devastate states’ ability to fund both home and institutional care. Will this discussion of the consequences of Social Security cutbacks address the LTC side issue? Likely not, but it matters hugely to those of us in the LTC field.