The social security system has faced a lot of challenges in recent times. This has been occasioned by the growing number of recipients that include a huge number of retiring individuals as compared to young people entering the system. One example of a security system that is under this threat is the Old-Age Survivors, Disability, and Health Insurance (OASDHI). OASDHI program primarily exists in two forms Medicare which is the health benefit and insurance component and the social security component which provides economic benefits for old age or those who have retired, survivors, and those with disabilities. Because of these wide roles, it is expected that the system faces challenges.
The main challenge facing the OASDHI is financial. Projections point to the fact that the kitty could be depleted anywhere between 2035 to 2052. This is due to the increase in the aging population that has driven the social security and Medicare costs high. This is coupled with increased health care costs due to increased chronic illnesses among the dependents.
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As the problem is primarily occasioned by an aging population, the solution lies in having more young people in the system. Most young people cite a lack of unemployment benefits as a reason to evade formally joining the security system as much as they can. Having unemployment benefits to young people as part of social security will help them appreciate that it is there for them. Secondly, governments need to ensure adequate employment opportunities for the youth through the embracing of formal online works, paid internships, and volunteers amongst other measures just to ensure the consumption effect of young people on the economy is sustained to ensure economic growth. Third, preventive health measures such as early disease screening, physical activities, good dietary choices, and avoidance of leading causes of accidents will all aid in cutting down on expenses.
Another challenge that has placed the system in danger is because of the economic slump that doesn’t augur well for the future. The 2008 economic recession was an example where most people lost jobs cutting down on overall contribution to the system. In the ongoing coronavirus disease 2020 pandemic and its subsequent economic shutdown, it is expected that contributions to the system will decline to put it at greater risk.
Sudden risks can be mitigated by adopting initial preventive measures that are usually cheap, unlike the post-impact measures that are costly. For instance, prevention of infection from infectious disease through isolation is better than treatment through intensive care admissions. Social securities should use social media to pass the information on its significance in times of economic uncertainties to garner public support.
The fourth industrial revolution that has seen the spread and wide use of digital technologies have revolutionized the way of life. It is no longer mandatory for an individual to go to the traditional office set up to handle tasks. Rather one operates from the comfort of their room or even overseas. To the social security net, this may mean fewer contributions as most of the work is made in an informal freelance set up as governments lack the necessary mechanism to adequately formalize this. This is only bound to increase.
The alleviation of this challenge lies in coming up with laws that extend coverage to new kinds of jobs. With regulatory codes embedded for online jobs, the financial sustainability of the contributions will be guaranteed. Thus, it is obvious that the social security system is under threat. However, a few corrective steps have been proposed that may aid in diminishing the threats encountered.
