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Trump's Tax Cuts Starve Medicare Trust Fund, Cutting Benefits by 2040

Yahoo Finance •
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The Congressional Budget Office dramatically shortens Medicare Part A's financial lifespan, projecting the HI trust fund will be exhausted by 2040, a full 12 years sooner than previously forecast. This accelerated depletion stems primarily from the 2025 reconciliation act (the One Big Beautiful Bill Act), which slashed tax revenues the trust fund normally receives by reducing rates and creating an age-based deduction for retirees. 2040 marks the year Medicare would face automatic benefit cuts of 8% initially, escalating to 10% by 2056, as spending would exceed income. The fund's 25-year actuarial deficit worsened to 0.30% of taxable payroll, demanding urgent legislative fixes. One Big Beautiful Bill Act