Social Security has been around since 1935. Medicare was established in 1965. But while both federal programs have been around for decades, they've undergone some key changes along the way.
More reforms could be coming. Two huge changes to Social Security and Medicare are on the table. Here's what they are -- and how they could affect you.
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Two huge proposed changes
The Republican Study Committee (RSC) includes 175 GOP members of the U.S. House of Representatives. This group recently released its proposed federal budget for fiscal year 2024.
In the opening letter to this proposed budget, RSC chairman Kevin Hern (R-Okla.) and the organization's budget and spending task force wrote, "The RSC Budget is more than just a financial statement. It is a statement of priorities." Those priorities span multiple issues, but Social Security and Medicare were among the top ones.
The biggest Social Security reform put forward by the RSC is to "make modest adjustments to the retirement age for future retirees to account for increases in life expectancy." The proposed budget document itself didn't provide details. However, Rep. Ben Cline (R-Va.), who chairs the budget and spending task force, has previously stated that the full retirement age for Social Security would be gradually raised from 67 to 69.
As for Medicare, the RSC's proposed 2024 budget includes a premium support model for the program. Under this model, private insurance plans would compete with traditional Medicare, including Parts A, B, and D. Seniors would receive federal subsidies to help pay for whichever Medicare plan they select.
How they could affect you
Will current beneficiaries or Americans nearing retirement be affected by the RSC's proposed Social Security changes? The RSC emphatically says "No." The RSC Budget and Spending Task Force stated, "[W]e will not now or ever support cutting or delaying retirement benefits for any senior in or near retirement."
The RSC's proposed budget left unclear exactly who would be affected by the gradual increase of the full retirement age. However, Rep. Cline revealed that the plan was to increase the retirement age by three months per year beginning in 2026 for Americans currently aged 59 or under until it reaches 69 for anyone turning 62 in 2033.
Any senior eligible for Medicare could opt to select a private plan under the premium support model. However, no one would be forced to do so. Individuals would still be able to go with traditional Medicare.
The RSC insists that the proposal doesn't reduce benefits or increase premiums for any Medicare beneficiaries. Instead, the GOP group argues that the model would reduce Medicare premiums. According to the RSC, the Congressional Budget Office determined that a more limited version of the premium support model would lower Medicare premiums overall by 7%.
An uphill climb
For either of these huge changes to go into effect, the RSC would need to first convert its proposed budget into a bill. That bill would then need to pass in both the House and the Senate. It would also ultimately require President Biden's signature.
That's an uphill climb, to say the least. Some prominent Democrats have already voiced their opposition to the RSC's proposals.
Rep. Brendan Boyle (D-Penn.) is the ranking Democratic member of the House Budget Committee. He stated that the GOP is "attempting to renege on our sacred promise to American workers and seniors by renewing their attacks on Social Security and Medicare."
White House Press Secretary Karine Jean-Pierre released a statement about the RSC's proposed budget. This statement said that the GOP plan "amounts to a devastating attack on Medicare, Social Security, and Americans' access to health coverage and prescription drugs."
Raising Social Security's full retirement age and implementing a premium support model are indeed on the table. But these huge changes are unlikely to be implemented anytime soon.
