As a country, we are in the final homestretch of the 2024 election. Early voting is taking place in multiple states and the presidential candidates are wrapping up their national appearances. As we move closer to the 2024 presidential election on Tuesday, November 5 — just few weeks away — we're taking a look at where the two candidates stand on Social Security and Medicare. In this story, we take a look at what former President Donald Trump, the current Republican nominee, said and did in his first administration, and what he has said on the campaign trail more recently.
In a separate article, we look at what Vice President Kamala Harris, the Democratic nominee, has said on Social Security and Medicare. (Read Kamala Harris' Stances on Social Security and Medicare). The two candidates disagree on how to fund the ailing programs. But as Social Security and Medicare are the government's two largest programs in terms of both finances and the number of people impacted, its important to look at the claims of both.
The stakes for Social Security
Social Security is the government's single biggest budget item and largest program, accounting for $1.4 trillion, or 21% of the budget in 2023, and covering approximately 182 million workers. Medicare is the second largest budget item (as part of the larger Health spending category), accounting for $848 billion, or roughly 12% of the budget last year, with Medicare enrollment topping 63 million.
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Predicting when Social Security’s trust fund will be exhausted is not an exact science. According to the Social Security Board of Trustees' May 2024 report, the trust fund will be insolvent in November 2035, one year later than previously projected. However, a more recent report from the Congressional Budget Office (CBO) projected that Social Security would run out of money in 2033. Although Social Security would still exist after that time, retirees would likely only receive 79% of their full benefits unless congressional lawmakers adopt changes before then. Tactics they may take might involve increasing Social Security payroll tax and trimming benefits.
While Social Security is in danger of running out of cash, Medicare’s finances have improved slightly over the past year. Even so, Medicare, a federal healthcare program for seniors ages 65 and older and for people getting disability benefits, is also expected to encounter a cash crunch in 2036.
Social Security was established by President Franklin D. Roosevelt’s administration in 1935. It provides monthly income to more than 67 million beneficiaries, including retired Americans, disabled workers, survivors of deceased workers, and families. However, with approximately 10,000 people entering the Social Security program each day due to the retirement of baby boomers, it’s no wonder the system is overburdened.
The stakes for Medicare
Medicare is, in essence, a national health plan first visualized by President Teddy Roosevelt. President Harry Truman also fought to get a bill passed during his term, but was unsuccessful, and it was another 20 years before a form of national health insurance — Medicare for Americans 65 and older, and younger people with disabilities — would become a reality.
Today, Medicare serves more than 63 million people. It is not private insurance and it doesn't offer plans for families and couples. That means the choices you make regarding the way you get your health coverage is up to you.
According to the annual Medicare Trustees reports, Medicare covers about half of healthcare expenses of enrollees. The remaining costs of healthcare are almost always covered by taking additional private insurance and/or by joining a public Medicare Part C and/or Medicare Part D health plan. These same trustees now project that Medicare's hospital-insurance benefits will run out of money in 2036, if not sooner.
How Trump addressed Social Security in his first term
Trump’s approach in the past ties to the belief that a stronger economy would naturally sustain Social Security. He argued then, as he does today, that economic growth and job creation would boost payroll tax revenues, thereby supporting the program. However, experts mostly agree that economic growth alone isn't enough to solve the substantial funding issues facing Social Security.
While the idea of banning taxes on Social Security, which Trump has voiced repeatedly during his campaign, may sway some voters, his proposal to end Social Security taxes could destabilize benefit amounts in the long term.
In his 2011 book, Time to Get Tough, Trump tasked the federal government with honoring a deal by delivering on payouts to workers who've paid into the program for decades. Prior to being elected president, he advised his fellow Republicans to approach the issue carefully, saying during the Conservative Political Action Conference in 2013:
"As Republicans, if you think you are going to change very substantially for the worse Medicare, Medicaid, and Social Security in any substantial way, and at the same time you think you are going to win elections, it just really is not going to happen... What we have to do and the way we solve our problems is to build a great economy." In other words, Trump’s position echoes his long-held conviction that the Republican Party should avoid attaching itself to entitlement reform.
Prior to being elected president in 2016, Trump insisted he would preserve both Medicare and Social Security. However, during his term in office, Trump made no significant headway in remedying Social Security and Medicare's funding issues. Each of his yearly federal budgets proposed spending cuts in Social Security, Medicare and Medicaid. However, the cuts were primarily in reduced payments to healthcare providers and hospitals, as opposed to recipient benefits, and were not enacted, regardless.
What Trump has said about Social Security recently
Former President Trump has said he would not make cuts to Social Security if elected or change the retirement age. While he hasn’t laid out detailed plans on how he plans to stabilize the program if re-elected, Trump has proposed cutting taxes on Social Security. Although some experts say that could cause more harm to the program than good, many voters are not convinced.
The Committee For a Responsible Federal Budget (CRFB) has said that the Trump administration's plan would cause Social Security to become insolvent early, among other things, including:
- Increasing Social Security’s ten-year cash shortfall by $2.3 trillion through 2035.
- Furthering insolvency by three years, from FY 2034 to FY 2031, leading to a 33% across-the-board benefit cut in 2035, up from the 23%.
- Increasing Social Security’s annual shortfall by roughly 50% in FY 2035, from 3.6% to 4% of payroll.
- Requiring the equivalent of reducing current law benefits by about one-third or increasing revenue by about one-half to restore 75-year solvency.
In other words, insolvency could occur earlier in 2031 or at some point in 2032 under the CRFBs high- and low-cost scenarios, respectively.
This year, taxes on Social Security benefits are expected to raise about $94 billion. Data from the Congressional Budget Office (CBO), show the total reduction in revenue would be $1.6 trillion between fiscal years 2026 and 2035 — with $650 billion less for Medicare and $950 billion less revenue for Social Security.
The highest-income households or those making nearly $5 million or more annually would see the biggest benefit from untaxed Social Security income. Hypothetically, if there were no taxes on the benefit they’d get an average tax cut of nearly $2,500 in 2025. Middle- and upper-income households, or those earning between $63,000 and $200,000 would also get a break, as a share of after-tax income. Households in this income range would see a tax cut between $1,190 and $1,430.
Keep in mind that if you file as an individual on your income taxes, and have a total annual income that’s less than $25,000, you won’t have to pay taxes on your Social Security benefits. Single filers with a combined income of $25,000 to $34,000 will pay income taxes on up to 50% of their Social Security benefits. If your combined household income is more than $34,000, you will pay taxes on up to 85% of your Social Security benefits.
In January 2023, as reported by Politico, Trump said in a video: “Cut waste, fraud and abuse everywhere that we can find it and there is plenty, there’s plenty of it. But do not cut the benefits our seniors worked for and paid for their entire lives. Save Social Security, don’t destroy it."
Trump's campaign platform says his administration would “fight for and protect Social Security and Medicare with no cuts, including no changes to the retirement age.” Trump maintained this stance when speaking to a crowd of supporters in Doral, Florida, earlier this July, where the former president vowed not to cut benefits. "I will not cut one penny from Social Security or Medicare," he said. "And I will not raise the retirement age by one day."
How Trump addressed Medicare in his first term
Medicare provides health coverage to more than 63 million Americans over the age of 65. But an aging population and increased enrollment, along with rising healthcare costs, are major factors that have contributed to Medicare’s current financial strain.
Trump stated in 2016 that his administration would act to "Modernize Medicare," which refers to proposals such as premium support and raising the age of Medicare eligibility. Trump supported repealing and replacing the Affordable Care Act (ACA), which many feared would adversely affect the Medicare provisions included in the law, such as drug benefits, improved preventive benefits and numerous Medicare savings proposals.
During his time in office, President Trump did propose some cuts to Medicare, as reported by the New York Times — though experts said these cost reductions would not have significantly affected benefits. (They were not enacted by Congress).
Ex-President Trump also published the Executive Order on Protecting and Improving Medicare for Our Nation’s Seniors in October 2019. The order included an overhaul of the Medicare for All program. The EO states that "Rather than upend Medicare as we know it, my (Trump) Administration will protect and improve it." It went on to say that “Medicare for All” would take away the choices in healthcare currently available within Medicare and centralize even more power in Washington, harming seniors and other Medicare beneficiaries.
The EO states that the Trump administration would protect and improve Medicare by building on those aspects of the program that work well, including the market-based approaches in the current system.
The EO directed Trump's government to build on the access Medicare Advantage beneficiaries have to tax-advantaged medical savings accounts and to determine ways for those beneficiaries to earn cash rewards or rebates in exchange for saving the program money by receiving quality care.
The EO also looked to give seniors more plan choices, cut the administrative costs that healthcare providers pay and reduce the time it takes for Medicare to decide whether or not it will cover a treatment that has received FDA approval.
On the issue of prescription drug costs, Trump previously supported allowing safe importation of prescription drugs from other countries, but that position was never reflected during his campaign or his time in office.
In 2018, then-President Trump signed these five Medicare healthcare changes into law, as reported by PBS:
- Medicare’s Independent Payment Advisory Board was abolished before even starting.
- The rules for Medicare’s Part D drug plans were changed with the coverage gap (or donut hole) in these plans ending (in 2019).
- Consumers who spent a great deal of money on drugs and entered the so-called catastrophic phase of Part D plans will pay no more than a few dollars for each prescription or, for costly drugs, no more than 5% of the cost of the drug.
- Medicare’s caps on covered expenses for outpatient therapy were officially repealed.
- People making more than $500,000 a year ($750,000 for couples) will pay 85% of the actual costs of Part B and D in 2019, up from 80% a year earlier. Most Medicare enrollees pay premiums that equal about 25% of these costs.
- Medicare Advantage plans would now pay for limited long-term care expenses – something that until now has not been covered by Medicare.
What Trump has said about Medicare recently
Agenda47, the Trump administration's official policy platform for the 2024 presidential election, states: “Healthcare and prescription drug costs are out of control. Republicans will increase transparency, promote choice and competition, and expand access to new affordable healthcare and prescription drug options. We will protect Medicare and ensure Seniors receive the care they need without being burdened by excessive costs.”
The document also states that “Republicans will protect Medicare’s finances from being financially crushed by the Democrat plan to add tens of millions of new illegal immigrants to the rolls of Medicare and vow to strengthen Medicare for future generations.”
During the 2024 presidential campaign, former President Trump has repeatedly said that he will not cut Medicare. But, during his presidency, Trump released four successive annual budgets that proposed reducing Medicare spending. Policy experts disagree about whether Medicare beneficiaries would have been hurt by those cuts if enacted.
"It’s difficult to know with any certainty what Donald Trump’s agenda for Medicare would be, given the lack of specificity in his platform," said Juliette Cubanski, deputy director of the program on Medicare policy at KFF, a healthcare policy think tank, as reported by Politifact. She noted that while his campaign platform rules out cuts to Medicare, it doesn't rule out changes that would "fundamentally transform the defined-benefit nature of the program."
A little more than a week after becoming the Democratic nominee, Harris said at a July 30 rally in Atlanta, "Donald Trump intends to cut Social Security and Medicare." Politifact previously rated Harris’ comments about Trump cutting Medicare (or Social Security) as Mostly False.
Bottom Line
It's misleading to say that the issues facing Medicare and Social Security are singularly related to Congress reducing the portion of tax dollars pouring into the programs. It can be argued instead that it is the framework for these programs that lawmakers set up originally. If that's true, the best foot forward would be finding a bipartisan path forward on legislation to change spending or revenue, or both.
Medicare and Social Security have been hot topics of debate for decades. But the fact remains that each program is strapped for cash and there is no easy way out. Both the Republicans under Trump and the Democrats under Biden (and many administrations before them) made promises to overhaul Medicare and Social Security, but clearly, all have come up short.
If Trump is re-elected in 2024, he has promised not to cut one penny from Social Security or Medicare and not raise the retirement age by one day.
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