Transcript of remarks by Treasury Secretary Timothy Geithner on the 2012 Social Security & Medicare trustees report:

Treasury Secretary Tim Geithner. SOURCE: C-Span.org

“Every year, as you know, the Social Security and Medicare Boards of Trustees issue reports to Congress on the strengths of these two indispensable programs. And we just met to complete this year’s financial review and to transmit to Congress the final reports.

Read more: Analysis: Reforms needed to ensure sustainability of Social Security & Medicare

“Millions of Americans rely on Social Security and Medicare for income and for health care, and millions more will do so in the future.

“As today’s reports make clear, these programs have the resources they need to fulfill their commitments to the American people for years to come.

“But what these reports also reinforce is that we must take steps to keep these programs whole for the future. Pressures on these programs are mounting. Americans are living longer and the number of retirees is growing.

“The reports project that, when considered on a combined basis, Social Security’s retirement and disability programs’ dedicated funds sufficient to cover benefits for the next 20 years. But in 2033, incoming revenues and trust fund resources will be insufficient to maintain the payment of full benefits. After that time, dedicated funds will be sufficient to cover about three-quarter of full benefits.

“Medicare’s hospital insurance trust fund will have resources sufficient to cover benefits until 2024 – the same year as was projected in last year’s report.

“The projections in this year’s report, however, are somewhat more pessimistic than last year’s projections.

“For the combined Social Security and disability trust funds, the 75-year actuarial imbalance is up four-tenth of a percentage point. This is in large part due to the Trustees’ assumptions of lowered real wages over the 75-year projection period.

“With regard to Medicare, the projected actuarial imbalance of the trust fund has increased by six-tenths of a percentage point due to changes in cost production projection methods recommended by 2010-2011 Medicare Technical Review Panel.

“While uncertainty surrounding these 75-year projections is very substantial, nonetheless, these reports emphasize the importance of building consensus on reforms that will put these programs on a sounder financial footing for the future.

“The Affordable Care Act began this process with the most significant entitlement reform in decades. That law includes measures to strengthen Medicare by reigning in health care costs growth.

“And one of the most important thing we can do now to preserve Medicare is to implement the Affordable Care Act fully and effectively.

“But more needs to be done. And that’s why the President has put forward a detailed plan to further reform and strengthen Medicare.

“By the beginning of the next decade, his plan achieves the same amount of annual health savings as the bipartisan plan proposed by Simpson-Bowles recommended.

“The President’s approach would lower costs by changing the way we pay for health care with new incentives for doctors and hospitals, eliminating excess subsidies to prescription drug companies, and asking the very wealthiest seniors to pay a little more.

“The President has also committed to keeping Social Security strong for future generations, particularly as more private employers move away from defined benefit plans.

“In his State of the Union address last year, the President outlined a set of principles for reform. These principles emphasize the importance of finding a bipartisan solution that strengthens Social Security and does not hurt current recipients, does not slash benefits for future retirees, or tie the program to the stock market.

“As we work to strengthen Social Security and Medicare, it is critical that reforms are slowly phased in over time so that current beneficiaries are not affected and so that future beneficiaries do not experience precipitous changes.

“At the same time, adjustments to Social Security and Medicare must be balanced and even-handed. We will not support proposals that sow the seeds to their destruction in the name of reform or that shift the costs of health care to seniors in order to sustain tax cuts for the most fortunate Americans.

“Social Security and Medicare are the twin pillars of retirement security in this country. They are, as President Obama has said, expressions of the fact that we are one nation.

“These programs, which are rooted in the basic American sense of fairness and responsibility, have been supported across generations by both political parties in both Democratic and Republican administrations.

“Thank you.”