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The Growing Gap in Life Expectancy: Using the Future Elderly Model to Estimate Implications for Social Security and Medicare.

Mortality gradients by education and income have been rising in the United States and elsewhere. However, their impact on Social Security progressivity has received relatively little attention, and the impact on Medicare has received effectively none. This paper uses the Future Elderly Model to estimate the effects of increased mortality gaps on the progressivity of Social Security and Medicare for those born between 1928 and 1990. It finds significant reductions in progressivity of both programs if current mortality trends persist and noticeable effects on total program costs. The effects are large enough to warrant more attention from both policy-makers and researchers.