Distributional Effects of Applying Social Security Taxes to Employer-Sponsored Health Insurance Premiums

by Kathleen Romig, Dave Shoffner, and Kevin Whitman
Policy Brief No. 2016-01 (released August 2016)
Table equivalent for Chart 1. Median change in the equivalent Social Security tax rate under the option for beneficiaries aged 60 or older, 2017–2080
Year Percent
2017 0.00
2018 0.00
2019 0.00
2020 0.00
2021 0.00
2022 0.00
2023 0.00
2024 0.00
2025 0.00
2026 0.00
2027 0.00
2028 0.00
2029 0.00
2030 0.00
2031 0.01
2032 0.03
2033 0.04
2034 0.06
2035 0.07
2036 0.09
2037 0.10
2038 0.12
2039 0.13
2040 0.15
2041 0.17
2042 0.19
2043 0.21
2044 0.23
2045 0.25
2046 0.27
2047 0.30
2048 0.32
2049 0.35
2050 0.37
2051 0.40
2052 0.43
2053 0.46
2054 0.49
2055 0.51
2056 0.54
2057 0.56
2058 0.58
2059 0.60
2060 0.62
2061 0.64
2062 0.66
2063 0.67
2064 0.68
2065 0.69
2066 0.71
2067 0.72
2068 0.73
2069 0.73
2070 0.74
2071 0.74
2072 0.75
2073 0.76
2074 0.75
2075 0.76
2076 0.76
2077 0.76
2078 0.76
2079 0.77
2080 0.76
SOURCE: Authors' calculations using MINT7.
Table equivalent for Chart 2. Median equivalent tax increase under the option for beneficiaries aged 60 or older, by shared lifetime earnings quintile and year
Shared lifetime earnings quintile 2030 2050 2070
Lowest 0.0 0.5 0.9
2nd lowest 0.0 0.6 1.1
Middle 0.0 0.5 1.0
2nd highest 0.0 0.4 0.8
Highest 0.1 0.2 0.3
SOURCE: Authors' calculations using MINT7.
Table equivalent for Chart 3. Beneficiaries aged 60 or older with higher benefits under the option, 2017–2080
Year Percent
2017 0
2018 0
2019 1
2020 3
2021 5
2022 8
2023 10
2024 13
2025 15
2026 16
2027 19
2028 21
2029 24
2030 27
2031 29
2032 31
2033 33
2034 35
2035 37
2036 39
2037 41
2038 43
2039 45
2040 47
2041 48
2042 50
2043 52
2044 54
2045 56
2046 57
2047 58
2048 60
2049 61
2050 62
2051 64
2052 65
2053 66
2054 67
2055 68
2056 69
2057 69
2058 70
2059 71
2060 71
2061 72
2062 72
2063 73
2064 73
2065 73
2066 73
2067 74
2068 74
2069 74
2070 74
2071 74
2072 74
2073 74
2074 74
2075 75
2076 75
2077 74
2078 75
2079 75
2080 75
SOURCE: Authors' calculations using MINT7.
Table equivalent for Chart 4. Median change in benefits under the option for beneficiaries aged 60 or older, 2017–2080
Year Percent
2017 0.00
2018 0.00
2019 0.00
2020 0.00
2021 0.00
2022 0.00
2023 0.00
2024 0.00
2025 0.00
2026 0.00
2027 0.00
2028 0.00
2029 0.00
2030 0.00
2031 0.00
2032 0.00
2033 0.00
2034 0.15
2035 0.24
2036 0.35
2037 0.46
2038 0.57
2039 0.67
2040 0.77
2041 0.89
2042 1.03
2043 1.16
2044 1.27
2045 1.41
2046 1.52
2047 1.64
2048 1.77
2049 1.91
2050 2.03
2051 2.18
2052 2.31
2053 2.42
2054 2.53
2055 2.63
2056 2.75
2057 2.83
2058 2.93
2059 3.01
2060 3.08
2061 3.15
2062 3.22
2063 3.27
2064 3.31
2065 3.35
2066 3.40
2067 3.45
2068 3.51
2069 3.55
2070 3.56
2071 3.57
2072 3.59
2073 3.59
2074 3.59
2075 3.59
2076 3.59
2077 3.59
2078 3.59
2079 3.61
2080 3.61
SOURCE: Authors' calculations using MINT7.
Table equivalent for Chart 5. Median change in benefits under the option for beneficiaries aged 60 or older, by shared lifetime earnings quintile and year
Shared lifetime earnings quintile 2030 2050 2070
Lowest 0 2 4
2nd lowest 0 3 5
Middle 0 2 5
2nd highest 0 2 3
Highest 0 0 1
SOURCE: Authors' calculations using MINT7.
Table equivalent for Chart 6. Median change in shared benefit/tax ratios under the option for beneficiaries aged 60 or older, by shared lifetime earnings quintile and year
Shared lifetime earnings quintile 2030 2050 2070
Lowest 0 -2 -3
2nd lowest 0 -2 -3
Middle 0 -1 -2
2nd highest 0 -1 -2
Highest 0 0 -1
SOURCE: Authors' calculations using MINT7.
Table equivalent for Chart 7. Poverty rates for beneficiaries aged 60 or older under scheduled benefits and the option, 2017–2080
Year Scheduled benefits Policy option
2017 5.7 5.7
2018 5.6 5.6
2019 5.8 5.8
2020 5.7 5.7
2021 5.6 5.6
2022 5.6 5.6
2023 5.6 5.6
2024 5.6 5.5
2025 5.4 5.3
2026 5.2 5.2
2027 5.2 5.1
2028 5.1 5.0
2029 5.2 5.0
2030 4.9 4.8
2031 4.8 4.7
2032 4.8 4.7
2033 4.7 4.5
2034 4.6 4.5
2035 4.4 4.3
2036 4.2 4.1
2037 4.2 4.0
2038 4.1 3.9
2039 4.0 3.8
2040 4.2 3.9
2041 4.1 3.8
2042 4.1 3.9
2043 4.0 3.7
2044 3.8 3.6
2045 3.8 3.6
2046 3.8 3.5
2047 3.6 3.4
2048 3.5 3.2
2049 3.5 3.2
2050 3.5 3.1
2051 3.4 3.1
2052 3.4 3.0
2053 3.3 2.9
2054 3.2 2.9
2055 3.0 2.7
2056 2.8 2.5
2057 2.9 2.5
2058 2.8 2.4
2059 2.7 2.4
2060 2.6 2.3
2061 2.5 2.1
2062 2.4 2.0
2063 2.4 2.0
2064 2.3 2.0
2065 2.2 1.9
2066 2.2 1.8
2067 2.2 1.9
2068 2.2 1.8
2069 2.1 1.8
2070 2.1 1.8
2071 2.1 1.8
2072 2.0 1.7
2073 1.9 1.6
2074 1.9 1.6
2075 1.9 1.5
2076 1.8 1.5
2077 1.7 1.4
2078 1.7 1.4
2079 1.7 1.4
2080 1.6 1.3
SOURCE: Authors' calculations using MINT7.
NOTE: This graph shows projected poverty rates for Social Security beneficiaries, which are lower than poverty rates for the elderly overall.