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From the monthly archives: February 2017

We are pleased to present below all posts archived in 'February 2017'. If you still can't find what you are looking for, try using the search box.

New Cost of Living Formula Could Put Real Money in Seniors' Pockets

 

There is a new push on Capitol Hill to link Cost of Living adjustments (COLAs) for federal retirement programs to a much more powerful indicator of the prices seniors really pay for crucial goods and services.  It’s called the Consumer Price Index for the Elderly (CPI-E), an experimental metric by the Bureau of Labor Statistics that more accurately reflects senior’s costs than the traditional Consumer Price Index (CPI), or even the Consumer Price Index for Wage Earners (CPI-W), which the government currently uses to calculate COLAs for Social Security.  Switching over to the CPI-E could mean a substantial increase in benefits for retirees.  

Congressman John Garamendi (D-CA) is reviving a 2015 House bill to mandate that the CPI-E be used to calculate cost of living adjustments for federal retirement programs. The National Committee has endorsed Garamendi's legislation.

"The consumption patterns of seniors are different from those of younger people. Using the CPI-E will ensure that benefits for retirees are not diluted by disproportionately rising costs in sectors affecting seniors. The CPI-E is the most accurate and balanced measure of the real costs that seniors face in retirement."  – Rep. John Garamendi (D-CA)

Like the standard CPI, the new index calculates the prices of a typical basket of goods and serves that are affected by inflation.  The difference is that the CPI-E looks at a basket that reflects the kinds of items seniors spend money on.  For instance, housing and medical costs make up a much bigger chunk of seniors’ expenses (58%) in the CPI-E than in the traditional CPI.  On the other hand, food and transportation costs are de-emphasized in the CPI-E, since seniors typically spend less of their money on those items than the general population does. 

If Congressman Garamendi’s bill were to become law, the CPI-E could mean serious new money in retirees’ pockets.  Research compiled from Bureau of Labor Statistics data (based on the current CPI-E model) reveals:

  • If the CPI-E had been in effect for the past 30 years, retirees would have received 22% more in cost-of-living increases.
  • If you as an average worker retired in 2015 with the current CPI-E in place, you would receive nearly $30,000 in additional benefits for the rest of your lifetime.

With 1 out of 3 seniors relying on Social Security for all or most of their income, those increases could make a huge difference.  At a time when Congressional Republicans (most notably Rep. Sam Johnson of Texas) are planning to cut COLAs, the Garamendi bill plants a flag on a crucial issue that could mean the difference between financial stability and poverty for millions of seniors.

Scrapping the Cap: National Committee endorses Bernie’s new Social Security Bill; Marks the Day Millionaires Stop Paying payroll taxes.

Senator Bernie Sanders and Rep. Peter DeFazio introduced landmark legislation yesterday to keep Social Security solvent for the next six decades --- without cutting anyone’s benefits.  The National Committee endorses the bill, titled the Social Security Expansion Act, introduced on the day when the average millionaire reaches the payroll tax income cap of $127,000 per year.

National Committee President Max Richtman joined Senator Sanders, Senator Elizabeth Warren, Rep DeFazio and other dignitaries and advocacy groups on Capitol Hill to mark the day and support the new legislation, which would require high-earners to pay Social Security taxes on annual income over $250,000. 

The bill doesn’t “scrap the cap” right away; but for now only income between $127,000 and $250,000 would be exempt from payroll taxes.  Eventually the cap would phased out and completely scrapped.   The expanded payroll taxes (which only affect the top 1.5% of earners) would keep the Social Security Trust Fund flush until at least 2078.   

"We can expand the life of Social Security for 61 years, if we have the guts to tell millionaires and billionaires they’re going to have to pay more in taxes.” – Sen. Bernie Sanders

Senator Warren passionately defended the bill, saying it is necessary because, under current law:

"...Once [the wealthy] hit the cap, they can earn and earn and earn without paying into the system.  We want a Social Security system that works of all America, not just the millionaires and billionaires.” – Sen. Elizabeth Warren

NCPSSM President Max Richtman referred to a favorite metaphor involving a high-earning NBA superstar paying into Social Security.  “He’s already hit the cap and is done contributing before the first quarter of the first game of the season is over.” On a more serious note, he continued, “We are here today to say that for those who have so much, it is only right that they pay their fair share into the Social Security program.”

Richtman used the occasion to recall the words of President Franklin D. Roosevelt, who started the Social Security system:

"The test of our progress is not whether we add more to the abundance of those who have much, it is whether we provide enough for those who have little."  - FDR

In addition to lifting the cap, the Sanders-DeFazio bill increases Social Security benefits by an estimated $65 a month, improves the Special Minimum Benefit by making it easier for low-income workers to qualify for benefits, and links the cost-of-living adjustment (COLA) formula to a new Consumer Price Index for the Elderly (CPI-E) to factor in costs seniors traditionally face such as prescription drugs, utility bills and property taxes. 

 

New Poll Shows Majorities Do Not Support GOP Proposals for Social Security and Medicare

Americans overwhelmingly support traditional Social Security and Medicare and oppose benefit cuts, according to a new poll released this week by the National Committee to Preserve Social Security and Medicare. At a time when Congressional Republicans are proposing to fundamentally alter both programs, strong majorities of voters want Congress to protect Social Security and Medicare – and intensely disagree with key provisions of GOP plans.

In the poll of likely voters, 79% favor increasing Social Security benefits --- and funding that increase by having wealthy Americans pay the same rate into Social Security as everyone else.   Seventy-seven percent oppose raising the Social Security retirement age to 69, and a whopping 93% favor allowing Medicare to negotiate to bring down the price of prescription drugs.

“These results prove that Americans want Congress to honor the commitment to all working people who paid into Social Security and Medicare, and keep their hands off these programs,” said Max Richtman, President and CEO of the National Committee to Preserve Social Security and Medicare. “This should be a warning to members of Congress that they tamper with our cherished social insurance programs at their peril.”

The poll results were released Tuesday at the U.S. Capitol by Richtman, with Senator Chris Van Hollen (D-MD); Rep. John Larson (D-CT); Rep. Tony Cardenas (D-CA); Celinda Lake, President Lake Research Partners; Witold Skwierczynski, President, National Council of SSA Field Operations Locals, Council 220, American Federation of Government Employees; Steve Hill, Director of Retirement Security Campaigns, SEIU; and Nancy Olumekor, Director, American Postal Workers Union Retiree Department.  

“Social Security and Medicare represent a promise America has made to all those participating in this system,” said Senator Van Hollen. “Americans overwhelmingly want to strengthen these essential lifelines. I strongly support efforts to ensure that these programs can increase benefits and continue to deliver financial security for generations to come.”

Representative Larson said the poll underscores popular support for the kinds of measures he proposes in his Social Security 2100 Act, which keeps the program solvent into the next century while increasing benefits.  “Social Security is not an entitlement; it’s insurance we paid for,” said Larson.  “Let’s say to President Trump:  join us in protecting and expanding Social Security.”

Representative Tony Cardenas (D-CA) made an emotional plea to preserve the two programs by citing a family story. “My grandson’s great-grandmother was saved by Medicare.  It’s a matter of dignity and life.”  He railed against proposals to privatize social insurance programs.  “Do we value dignity? Do we value life?  Make our President and our Congress commit that they will not take it away from you!”

OTHER HIGHLIGHTS FROM THE POLL:

o   74% favor gradually requiring employees and employers to pay Social Security taxes on wages above $127K, including majorities across party lines.

o   75% favor including a Social Security benefits credit for up to five years of time spent outside the paid workforce caring for young children, aging seniors, or family members with disabilities.

o   65% oppose raising the Medicare eligibility age to 67.

The poll of 800 likely voters nationwide was commissioned by the National Committee to Preserve Social Security and Medicare and conducted by Lake Research Partners from January 4 to January 7, 2017. The poll was co-sponsored by the American Federation of Government Employees, American Postal Workers Union, Service Employees International Union and the United Steelworkers.

 

Why Seniors Should Care About Obamacare Repeal

There’s a great piece in the current Money magazine by Elizabeth O’Brien about the impact of ACA repeal on seniors.  The title alone makes it worth the read:  “Think Changes to Obamacare Won’t Affect You?  Think Again.”   In this article, O’Brien lays bare the consequences of ACA repeal to seniors, who, as the title implies, may not be aware of the repercussions for Medicare.

"The Affordable Care Act contains about 165 provisions affecting Medicare, according to Medicare's trustees. These range from improving benefits for the 57 million current beneficiaries to shoring up the program’s long-term finances for future ones.

These provisions include free wellness visits and preventative screenings for cancer, diabetes, heart disease and a host of other medical conditions – with no out of pocket costs – all of which could disappear if the ACA is repealed.  Likewise with the prescription drug “donut hole,” which the ACA was closing, saving the average beneficiary $1,000 a year.  As O’Brien notes, before Obamacare came along:

"More than three million beneficiaries hit the donut hole before the law took effect, and some [seniors] were forced to skip doses, split pills, or not fill their prescriptions at all due to high costs.

Who wants to go back to seniors splitting pills or going without their medicines?  

O’Brien also points out that because of the savings the ACA provided to Medicare, repealing the healthcare law will cost Medicare $802 billion between now and 2025.  There’s also a strong refutation of the argument by House Speaker Paul Ryan and HHS Nominee Tom Price that Medicare is “going broke,” which they will use as a canard to cut benefits.

Most tellingly, the Republicans are gunning for tax provisions that help pay for the ACA which mainly affect the upper middle class and the wealthy.  O’Brien quotes Matthew Yglesias of Vox:

"Republicans’ desire to eliminate these taxes is a big driver of their push to repeal Obamacare. Subsidizing the health care costs of working-class people is expensive, and while Democrats want rich people to pay the freight for doing it, Republicans do not."

The bottom line:  seniors and millions of newly insured Americans will pay more for healthcare – or go without it entirely – so that high earners can get a tax break. 

Powerful new Ads target Obamacare Repeal

The Alliance for Healthcare security, of which the National Committee is a member, has released the latest in a series of tv spots opposing repeal of the Affordable Care Act.  Watch the new ad here.  It's worth the 30 seconds of your time.  

This latest one is probably the most powerful of the series, which began airing in December.  The opening narration pulls no punches. "Congress has taken the first step to rip apart our healthcare with no plan to replace it," says the announcer.  The bulk of the ad features actual health care professionals in blue scrubs and white coats talking right into the camera about why repeal is such a bad idea.

"They don't have a plan to insure the 30 million people who will lose their healthcare," says Theresa, a registered nurse.  "No plan to cure existing conditions, like cancer," says Michelle, another RN, while a third nurse states simply, "It's gonna cause pain."

The tagline is:  "Tell Congress we need a plan that protects our care."

The ad is elegant, clean, and effective.  Pressure from advocacy groups and negative media coverage of the repeal efforts on Capitol Hill seem to be having an impact.  As the Associated Press reported today, some Congressional Republicans are starting to back away from repeal and talking more about what sounds like "repair," which is something even President Obama and Democrats had always said they would welcome. The Associated Press describes "a softer tone that comes as [the GOP's] march to fulfill a keystone campaign promise encounters disunity, drooping momentum and uneasy voters."

Last week, Congressional Republicans seemed like they were on a tear to repeal - ramrodding through a budget resolution that would defund Obamacare with the promise of a replacement bill soon after.  Not anymore, apparently.  

"Republicans triumphantly shoved a budget through Congress three weeks ago that gave committees until Jan. 27 to write bills dismantling the law and substituting a Republican plan. Everyone knew that deadline meant little, but now leaders are talking about moving initial legislation by early spring." - Associated Press

Seniors, especially, have a lot at stake in any repeal and replacement because of the Affordable Care Act's improvements to Medicare - including free preventative screenings and wellness exams, the closing of the Medicare Part D prescription drug "donut hole," and the extended solvency that the ACA provided to the Medicare Part A trust fund.  

Let's hope that this continued ad campaign by the Alliance for Healthcare Security, and the voices of organizations like ours along with pressure from the public will convince the GOP that outright repeal without a replacement that protects the healthcare of all Americans is a really unhealthy choice.  






   

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