March 14,2001

Thomas and Grassley Announce Joint Hearing on the Social Security and Medicare Trustees’ 2001 Annual Reports


Congressman Bill Thomas (R-CA), Chairman of the Committee on Ways and Means, andSenator Chuck Grassley, Chairman of the Senate Committee on Finance, today announced that theircommittees will hold a joint hearing to examine the findings and recommendations made by theBoard of Trustees of the Social Security and Medicare Hospital Insurance trust funds in its 2001Annual Reports on the financial status of the trust funds. The hearing will take place on Tuesday,March 20, 2001, in the main Committee hearing room, 1100 Longworth House Office Building,beginning at 10:00 a.m.

In view of the limited time available to hear witnesses, oral testimony will be heard frominvited witnesses only. However, any individual or organization not scheduled for an oralappearance may submit a written statement for consideration by the Committee and for inclusion inthe printed record of the hearing.

BACKGROUND:

The Board of Trustees was established under the Social Security Act to oversee the financialoperations of the Old-Age and Survivors Insurance and Disability Insurance (OASDI) and theMedicare Hospital Insurance (HI) trust funds. The Board is composed of six members: the Secretaryof the Treasury (who is the Managing Trustee), the Secretary of Labor, the Secretary of Health andHuman Services, the Commissioner of Social Security, and two members who are appointed by thePresident and confirmed by the Senate to serve as public trustees for four-year terms. The SocialSecurity Act requires that the Board of Trustees report annually to the Congress on the financial andactuarial status of the OASDI and HI trust funds. The 2001 Annual Reports are scheduled to bereleased shortly.

Ensuring the financial viability of Medicare and Social Security is one of Congress' mostimportant responsibilities. The annual release of the Trustees' Report provides a valuable update onthe programs’ fiscal well-being.

Over the past few years, the Trustees’ annual reports have shown an improvement in thefinancial status of the OASDI trust funds, mainly due to increased economic growth. The 2000Annual Report projected that the combined OASDI trust funds would begin running cash flowdeficits in 2015 and would become insolvent in 2037. In that year, annual payroll taxes would besufficient to pay 72 percent of promised benefits. President Bush has expressed his commitment toreforming Social Security and has announced his intention to strengthen Social Security andmodernize the program for young and future workers, beginning with a Presidential Commission onSocial Security reform. The findings of the Trustees will provide invaluable support to theCommission and the responsible committees in the House and Senate as proposals to save SocialSecurity are considered.

The release of the 2001 Annual Report on the Medicare HI trust fund report will beparticularly timely, because its findings will establish the financial parameters against whichMedicare modernization plans will be evaluated. Over the next several months, Congress will bedeveloping a comprehensive Medicare improvement package that will include a universally availableoutpatient prescription drug benefit. The Trustees' Report will help members evaluate new Medicarespending proposals and begin discussion on whether new solvency measures are needed to ascertainthe program’s overall financial standing.

In announcing the hearing, Chairman Thomas stated: “This historic joint hearing reflects ourdesire to work in a bipartisan and bicameral fashion to understand the fundamental challenges facingthe long-term health of both Social Security and Medicare. I look forward to this hearing and to thereport of the non-partisan Social Security and Medicare Trustees.”

Chairman Grassley said, “This joint committee hearing underscores the importance thecommittees place on ensuring the financial viability of these programs. The trustees’ findings willprovide critical guidance as we work to improve and strengthen Medicare and Social Security forthe baby boomers and beyond.”

FOCUS OF THE HEARING:

The hearing will examine the findings and recommendations of The 2001 Annual Reportsof the Board of Trustees of the Federal OASDI and HI Trust Funds. The hearing will focus on thelong-run financial status of the Social Security and Medicare HI programs.

DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:

Any person or organization wishing to submit a written statement for the printed record ofthe hearing should submit six (6) single-spaced copies of their statement, along with an IBMcompatible 3.5-inch diskette in WordPerfect or MS Word format, with their name, address, andhearing date noted on a label, by the close of business, Tuesday, April 3, 2001, to Allison Giles,Chief of Staff, Committee on Ways and Means, U.S. House of Representatives, 1102 LongworthHouse Office Building, Washington, D.C. 20515. If those filing written statements wish to havetheir statements distributed to the press and interested public at the hearing, they may deliver200 additional copies for this purpose to the Committee office, room 1102 Longworth House OfficeBuilding, by close of business the day before the hearing.