Social Security, Medicare face financial risk

The clock is ticking for lawmakers to address Social Security's financial shortfall before Americans begin to see their checks reduced.

The program is expected to run short of the funds needed to pay 100% of benefits in roughly a decade, according to an annual report from its board of trustees.

Social Security's combined trust funds for retirees, survivors and Americans with disabilities are estimated to run out by 2034 -- a year earlier than last year's projection. Without congressional action, the program's income would only be able to cover 80% of scheduled benefits.

The Old Age and Survivors Insurance Trust Fund, which is the trust fund for retirees, will only be able to make full payments until 2033 -- also a year earlier than previously projected -- the report stated. After that, the program will only be able to pay out 77% of scheduled benefits.

Medicare also faces serious financial headwinds but received slightly better projections in the newest report. Medicare's hospital insurance fund is projected to be solvent through 2031 -- three years longer than previously predicted. Past that date, the trust will only be able to pay 89% of total scheduled benefits.

Social Security and Medicare have become a hot-button political issues over the past few months amid a broader battle over the budget and debt ceiling.

President Joe Biden has sought to portray the GOP as a threat to Social Security and Medicare, pointing to various Republican proposals, even as House Speaker Kevin McCarthy and other leaders insist the programs will be "off the table" in spending talks. The political back-and-forth came to a head in a clash between Biden and some Republican lawmakers at his State of the Union address.

In his proposed 2024 budget, Biden included a plan to shore up Medicare’s finances through at least 2050 by increasing taxes on wealthy Americans and bringing down drug costs.

His budget, however, lacked a similar plan for Social Security. Experts told ABC News at the time that Biden’s options to significantly shore up Social Security’s finances are limited if he keeps his vow not to cut benefits or increase taxes for those making under $400,000 a year.

During the 2020 campaign, Biden suggested increased the payroll tax to 12.4% for Americans making more than $400,000 per year, among other changes, to extend Social Security's solvency.

The Republican Study Committee, which represents the largest group of House Republicans, has previously called for raising the retirement age to 70 for younger workers and trimming auxiliary benefits for high-income earners.

“Lawmakers have a broad continuum of policy options that would close or reduce Social Security's long-term financing shortfall," the board of trustees wrote in their report.

The trustees urged Congress to come to a solution sooner rather than later.

"With informed discussion, creative thinking, and timely legislative action, Social Security can continue to protect future generations," they wrote in the report.

-ABC News' Molly Nagle, Elizabeth Schulze contributed to this report.