Medicare 2026

What the 2026 Social Security Trustees Report Says About the Future of Benefits

The Social Security Board of Trustees released its 2026 annual report earlier this year, giving Americans their yearly look at the financial health of the program that pays retirement, survivor, and disability benefits. The report was printed as House Document 119-163 and referred to the House Committee on Ways and Means on June 18, 2026. Its numbers are projections, built on the Trustees' "intermediate" assumptions set in February 2026, and they shape a lot of the conversation about Social Security's long-term future and, by extension, how it connects to Medicare.

If you receive Social Security or expect to, here is a plain-English look at what the report actually says — and what it means (and doesn't mean) for your benefits.

The headline numbers

The Old-Age and Survivors Insurance (OASI) trust fund — the one that pays retirement and survivor benefits — is now projected to run down its reserves in the fourth quarter of 2032. That is one quarter earlier than the Trustees estimated last year. Importantly, "depletion" does not mean benefits stop. After that point, incoming payroll taxes would still be enough to pay 78 percent of scheduled benefits, a share the Trustees estimate would gradually decline to 62 percent by 2100. The report is explicit that legislative action will be needed to prevent that reserve depletion.

Looking at OASI and Disability Insurance (DI) together, the Trustees project combined reserves would be depleted in the third quarter of 2034 — the same quarter as in the 2025 report. After that, revenue would cover 83 percent of scheduled benefits, declining to 65 percent by 2100. One caveat: paying full benefits all the way through 2034 assumes Congress changes the law to allow transfers between the two funds as needed. The DI fund alone is projected to stay positive through 2100.

Over the full 75-year projection window (2026–2100), the Trustees estimate the actuarial deficit at 4.42 percent of taxable payroll, up from 3.82 percent in last year's report. The largest driver of that increase, they say, is a lower assumed ultimate fertility rate — 1.75 children per woman, down from 1.90.

What the program looked like in 2025

To ground these projections in today's reality: in 2025, Social Security's total income was $1,449 billion and its total cost was $1,609 billion. Trust fund reserves made up the $160 billion difference, declining from $2,721 billion at the start of the year to $2,561 billion at the end. In December 2025, the program paid benefits to 70 million people.

Illustrating the shortfall

To show how big the long-term gap is — not as a recommendation — the Trustees include some illustrative choices. The combined program could pay scheduled benefits through 2100 if, starting in January 2026, the payroll tax rate rose from 12.40 percent to 16.65 percent, or scheduled benefits were cut 25.2 percent for all current and future beneficiaries, or 30.3 percent only for people newly eligible in 2026 and later — or some equivalent mix. These are illustrations of scale, not proposals.

How Social Security and Medicare are connected

Many people don't realize that a slice of Social Security tax revenue flows into Medicare. Under current rules the Trustees describe, benefits can be partly subject to federal income tax when a beneficiary's income (adjusted gross income excluding benefits, plus half of benefits and all non-taxable interest) is above $25,000 for single filers or $32,000 for joint filers. Up to 85 percent of benefits may be taxable, and the tax on the share above 50 percent is credited to Medicare's Hospital Insurance (Part A) trust fund.

What this means for 2027

The Social Security Administration announced on October 14, 2026 a 3.6 percent cost-of-living adjustment (COLA) for benefits payable beginning January 2027.

On the Medicare side, a few 2027 figures are already set at the national level. The Part D out-of-pocket cap rises to $2,400 (up from $2,100 in 2026). The most any Part D plan may charge as a deductible is $700. And the Part D base beneficiary premium — a national figure used to calculate the late-enrollment penalty — is $41.33. Plan premiums themselves are set plan by plan.

The 2027 Part B standard premium and deductible, along with the IRMAA income brackets and surcharges, have not yet been announced. CMS typically releases those figures in the fall, usually in November, on Medicare.gov.

Medicare's Annual Enrollment runs October 15 through December 7, 2026, with choices taking effect January 1, 2027. This is the window to compare Part D and Medicare Advantage options for the coming year. If you are weighing Medicare Advantage against Original Medicare paired with a Medigap policy and a stand-alone Part D plan, there are real trade-offs on both sides — provider networks, out-of-pocket structures, extra benefits, and the rules for switching later. Taking time to read the specifics for each option that applies to you is worthwhile; there is no one-size-fits-all answer.

A note for people with Medicaid or Extra Help

Since 2025, people with Medicaid or Extra Help have a monthly Special Enrollment Period to move to Original Medicare with a stand-alone Part D plan, or to switch stand-alone Part D plans. Full-benefit dual-eligible individuals can also enroll in an integrated Dual Eligible Special Needs Plan (D-SNP) in any month of the year.

Where to go next

For official, up-to-date Medicare costs, enrollment rules, and plan comparisons, visit Medicare.gov or call 1-800-MEDICARE (TTY 1-877-486-2048), available 24 hours a day, seven days a week. When the 2027 Part B figures and IRMAA brackets are published this fall, they will appear there first.