Health care coverage for early retirees (age 55 - 64) is often limited and unaffordable. This population is one of the fastest growing uninsured groups. Addressing this issue - along with the development of fiscally sound proposals to reform the Social Security and Medicare programs - will present some of the greatest domestic challenges our nation will face. This challenge can be met - and met in a way that maintains the viability of the U.S. retirement system.

Social Security plays an important role in the lives of all Americans and should continue to provide an essential floor of support for retirees, survivors, and the disabled. The current system, however, is financially unsustainable. The number of active workers supporting each beneficiary - 6.0 in 1960 - is now projected to fall from 3.3 today to 2.0 in 2030. In order for Social Security to be sustained and flourish, it must be reformed. Our challenge is to transition to an actuarially and fiscally sound system that meets the needs of the 21st century, yet recognizes the current U.S. demographic, economic and social environment. Medicare is a critical health care entitlement providing essential health care services to senior Americans and those who are disabled. It is financed by both payroll taxes and general revenues. Current growth and spending on this program are significantly higher than the rest of the economy. This problem is exacerbated by the fact that the ratio of workers to beneficiaries is decreasing rapidly, as well as growth in the volume and intensity of services.

Proposals to reform the Medicare program should include improving coverage choices through market competition and increased availability of private plan options. Solutions should also include changing reimbursement by rewarding value and paying for quality and outcomes rather than for tasks performed. All Medicare providers and private plans should adopt health information technology systems to reduce administrative costs, duplication of services and medical errors that result from paper systems.