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The Upcoming Social Security and Medicare Trustees' Reports: A Preview

Within the next several weeks, the trustees of the Social Security and Medicare trust funds are expected to release the 2017 Social Security and Medicare trustees’ reports. This report is intended to serve as a primer on the contents of those reports, and to preview certain aspects that may be worthy of attention by lawmakers, media, and the public.

The Social Security Act requires that the boards of trustees of the several Social Security and Medicare trust funds[a] report annually to the Congress on the recent and future operations of the trust funds. More specifically, the act requires that the trustees report on the “operation and status” of the trust funds during the preceding fiscal year as well as the next few years. The act also requires that the reports contain statements of the actuarial status of the trust funds, which the trustees have traditionally measured over a seventy-five year projection period. With respect to Social Security, the trustees are also required to issue a finding as to whether its trust funds are in “close actuarial balance.” The 2016 reports found that both the Social Security Federal Disability Insurance (DI) trust fund and the Medicare Federal Hospital Insurance (HI) trust fund failed the trustees’ test of short-range financial adequacy while Social Security’s Federal Old-Age and Survivors Insurance (OASI) trust fund failed their test of long-term adequacy. In short, the trust funds will eventually be depleted if lawmakers do not take corrective action.

The trustees’ reports, which have served as the primary public assessments of these programs’ financial conditions, also typically contain information of interest to policymakers that extends well beyond the specific evaluations required by law. This includes illustrative estimates of scheduled Social Security benefits, Medicare premiums, deductibles and provider payment updates, Social Security cost of living adjustments, and interactions between the trust funds and the federal government’s general fund.

By law the trust funds have six trustees: the Secretary of the Treasury, who serves as managing trustee; the Secretary of Health and Human Services; the Secretary of Labor; the Commissioner of Social Security, and “two members of the public (both of whom may not be from the same political party).” The public trustee positions were added by Congress in 1983 pursuant to recommendations of the National Commission on Social Security Reform, informally known as the “Greenspan Commission,” which was appointed by Congress and President Reagan in 1981 to study and make recommendations regarding the financing crisis that Social Security faced at that time.

The commitment to an independent, bipartisan source of program financing information has facilitated a public education role for the public trustees that is unique.

The commission opined that the addition of public trustees would “inspire more confidence” in the trust funds’ “investment procedure.” The subtext of this opinion was that interactions between the trust funds and the government’s general fund should not be managed to advantage one at the expense of the other. The commission further suggested that public trustees would help ensure that “the cost estimates for the future operations of the program would continue to be developed in an objective manner.”

The 2017 Social Security and Medicare trustees’ reports will be unique in that both the public trustee positions are vacant and the reports will be signed only by ex officio trustees, all of whom will be participating in the report process for the first time.[b]

Of the 32 pairs of trustees’ reports developed since public trustees first participated in crafting the reports in 1985, 27 featured the participation and signatures of public trustees. In four of the other five instances, at least three of the four participating ex officio trustees had co-authored the previous year’s report. In the only instance of an incoming administration’s developing the reports without public trustees, in 2009, one of the participating ex officio trustees was nevertheless completing a term of service begun during the prior administration. In the past, lawmakers have been so committed to maintaining public trustee input into the trustees’ reports that in the only instance of the public trustee positions becoming vacant during a presidential election year, in the spring of 2000, the U.S. Senate confirmed new public trustees on a Saturday just over a week before that year’s presidential election.

The commitment to an independent, bipartisan source of program financing information has facilitated a public education role for the public trustees that is unique and distinct from that of the ex officio trustees. Lawmakers have frequently called upon the public trustees to testify about program finances, separately from the cabinet officials who must simultaneously serve as spokespersons for administration policies. Historically the public trustees have exercised their discretion to speak and write in other forums as well, educating the public and press about program finances without coordinating these messages with the ex
officio trustees.

It has helped immeasurably that the two public trustees have generally striven to operate as a bipartisan team.

In addition, when an administration has developed a policy to respond to a projection of near-term trust fund depletion or developed another reform proposal for one of these programs, the public trustees have not participated in its development. These traditions have helped preserve the function of the public trustees as independent expert sources of program financial information. Towards this end, it has helped immeasurably that the two public trustees have generally striven to operate as a bipartisan team, rather than dividing to offer competing partisan perspectives.

Even without public trustees, the trustees’ reports benefit from the independent, non-partisan work of the Chief Actuary of the Social Security Administration and the Chief Actuary of the Centers for Medicare and Medicaid Services whose skilled career staffs, along with those of the other executive branch departments, have both the experience and non-partisan temperament required to ensure that the reports continue to be developed in an objective manner. It has also been our experience that administration political appointees typically join in the development of these reports with the same aim of performing objective analysis unaffected by administration policy goals.

Notwithstanding these reasons for public confidence, we are hopeful that the current administration will soon nominate, and the Senate will soon confirm, individuals to fulfill the vital functions of the public trustees. In recognition of the current absence of public trustees, however, the following information is offered to further public understanding of these critical reports.


Charles P. Blahous III and Robert D. Reischauer, the most recent public trustees of the Social Security and Medicare trust funds have reprised their roles through a new platform at the Bipartisan Policy Center by continuing to provide independent appraisals of the programs’ finances.

[a] These are the Federal Old-Age and Survivors Trust Fund (OASI), the Federal Disability Insurance Trust Fund (DI), the Federal Hospital Insurance Trust Fund (HI) and the Federal Supplementary Medical Insurance Trust Fund (SMI).
[b] Ex officio trustees are trustees by virtue of their government positions. For example, the Secretary of the Treasury is automatically a member of the Social Security and Medicarboards of trustees. The public trustees, in contrast, are appointed specifically as Social Security and Medicare trustees.
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