Forecasting US age structure and the future of social security: The impact of adjustments to official mortality schedules

The level of future expenditures on such old-age entitlement programs in the United Slates as Social Security and Medicare, and the development of public policy to fund these programs, are dependent on accurate estimates of the current and future size of the beneficiary population. Since most persons who will be eligible to draw benefits from these programs over the next 65 years have already been born, the critical demographic factor for projecting the size and age structure of the beneficiary population is mortality. Recent studies question the validity of old-age mortality rates in the United States, in large part because of problems with age misstatement and because of what appear to be unusually low death rates in North America relative to other low-mortality populations with reliable data. The authors examine the consequences of adjusting old-age mortality rates for observed and forecasted life expectancies, for forecasts of the size of the older population and for the projected funding of selected age-entitlement programs in the United States. Forecasts made using adjusted mortality schedules lead to estimates of life expectancy at birth and at older ages that, over the next 60 years, are lower than those published by the Census Bureau and the Social Security Administration.