Are you prepared for Medicare & Social Security benefits to be reduced by 11-17% in 11-12 years?

WASHINGTON -- The go-broke dates for Medicare and Social Security have been pushed back as an improving economy has contributed to changed projected depletion dates, according to the annual Social Security and Medicare trustees report Monday (May 6).

Still, officials warn that policy changes are needed lest the programs become unable to pay full benefits to retiring Americans.

Medicare's go-broke date for its hospital insurance trust fund was pushed back five years to 2036 in the latest report, thanks in part to higher payroll tax income and lower-than-projected expenses from last year. Medicare is the federal government's health insurance program that covers people age 65 and older and those with severe disabilities or illnesses. It covered more than 66 million people last year, with most being 65 and older.

Once the fund's reserves become depleted, Medicare would be able to cover only 89% of costs for patients' hospital visits, hospice care and nursing home stays or home health care that follow hospital visits.

Meanwhile, Social Security's trust funds - which cover old age and disability recipients - will be unable to pay full benefits beginning in 2035, instead of last year's estimate of 2034. Social Security would only be able to pay 83% of benefits.

About 71 million people - including retirees, disabled people and children - receive Social Security benefits.

President Joe Biden responded to the report by saying that "as long as I am president, I will keep strengthening Social Security and Medicare," adding that he wants high-income taxpayers "to pay their fair share" to bolster funding for the benefit programs.

Lawmakers have for years kicked Social Security and Medicare's troubling math to the next generation. Social Security benefits were last reformed roughly 40 years ago, when the federal government raised the eligibility age for the program from 65 to 67. The eligibility age has never changed for Medicare, with people eligible for the medical coverage when they turn 65.

Congressional Budget Office reporting has stated that the biggest drivers of debt rising in relation to GDP are increasing interest costs and spending for Medicare and Social Security. An aging population drives those numbers.

The future of Social Security and Medicare has become a top political talking point as President Joe Biden and Republican former President Donald Trump both campaign for reelection this year.

Biden, a Democrat, has vowed to rebuff any Republican-led efforts to cut Medicare or Social Security benefits to brace for the shortfall. He's pitched raising taxes on people making $400,000 or more a year, to shore up Medicare.

Trump, in an interview with CNBC in March, indicated he would be open to cuts to Social Security and Medicare. The former president said "there is a lot you can do in terms of entitlements, in terms of cutting."

Nancy Altman, president of Social Security Works, an advocacy group for the social insurance program, said Monday's report shows that "Congress should take action sooner rather than later to ensure that Social Security can pay full benefits for generations to come."

AARP CEO Jo Ann Jenkins said " the stakes are simply too high to do nothing."