Medicare Part D Could Be Helping More

Recently the U.S. Government Accountability Office has been looking more closely at the financial and health challenges faced by older Americans. As you know, many Americans who are no longer able to participate in the workforce often find themselves lacking resources. As a result, the GAO has decided to take yet another look at LIS - the Medicare Part D Low Income Subsidy and its effectiveness. This is particularly significant because as the National Elder Economic Security Index illustrates, LIS is a valuable support program that can help older Americans reach economic security.

The Centers for Medicare & Medicaid Services and the Congressional Budget Office have estimated, respectively, that about 2.6 million to over 4 million individuals who may qualify for the Medicare prescription drug low-income subsidy are not receiving it. Various barriers, such as reluctance to disclose personal financial information or lack of knowledge of the subsidy, may prevent potentially eligible Medicare beneficiaries from applying for the subsidy.

To view the highlights of the report, go to http://www.gao.gov/highlights/d08812thigh.pdf .

To learn more about the role Medicare Part D LIS can play in achieving economic security, please visit the Elder Economic Security Initiative website: http://www.wowonline.org/ourprograms/eesi/
Comments Please: Have you or a family member encountered problems with the accessibility of the Medicare Part D LIS Program?

Promoting Individual Retirement Saving

The discourse on individual retirement saving continues to heat up! Recently a series of forums have been held on this topic here in DC. In late April, we had the chance to attend one such forum which was moderated by J. Mark Iwry of the Brookings Institution and Retirement Security Project. Presenters included Teresa Ghilarducci of the New School for Social Research, Gene Sperling of the Center for American Progress, and David C. John of the Heritage Foundation and Retirement Security Project.

To provide some context for the discussion Mr. Iwry opened by making a few statements regarding retirement income. He first insisted that the retirement security problem is largely a health care problem because it accounts for such a large amount of retiree out-of- pocket costs. He followed by insisting that program and policy change needs to target moderate to lower income people and utilize more saving incentives.

Ms. Ghilarducci's points of emphasis were that those currently in their 40s and 50s are likely to be the first generation to experience a significant decrease in living standards in old age. However, EESI data shows that this is not a new problem for women and especially women of color. Her presentation centered a Guaranteed Retirement Accounts (GRAs) proposal. Under the GRAs plan, most employers and workers would be required to contribute. Contributions would be lightly subsidized, returns would be guaranteed, and the investment funds would be managed by the federal government. The GRAs would serve as a supplement to Social Security income.

Mr. Sperling's presentation focused on the idea that we need to "disrupt the system as little as possible" by implementing a portable saving system with a matching tax credit -- the Universal 401(k) Plan with automatic enrollment features.

Mr. John’s proposal focused on individual responsibility and individual savings. He made the case that savings would increase with automatic enrollment (employee participation as the default option). He also encouraged employers and employees to take advantage of existing payroll deduction systems.

While we always support increased dialogue surrounding retirement security, it was clear that this forum’s focus was primarily on those with the means to save. The reality is that few and fewer Americans have the extra resources to do so. A robust discussion on retirement security should include program and policy changes that would positively affect those working so hard each day just to make their basic ends meet, that do not have the extra funds to allocate to savings. With the rising cost of necessities such as food and gas this cohort is only going to balloon. This growing majority needs solutions that acknowledge and honor their years of work and does not penalize them for their self-sufficient manner during their working years. We hope that advocates and policymakers find the Elder Economic Security Initiative useful in informing the various proposals. The difficulties faced by low wage workers and the cumulative disadvantage faced by the majority of women in the workforce are largely left out of the discussion though they are an integral part of the spectrum.

For more information on the forum described above, please visit the following webpage: http://www.aarp.org/research/ppi/policylive.html

Comments Please: We must focus program and policy discussions to building upon current structures in a manner that reasonably recognizes the current economic landscape. Specifically, what kinds of program do you think those who are most vulnerable during their retirement years would benefit from the most, with regard to retirement income adequacy?

EESI Action Alert!

Help Protect Vulnerable Seniors Against Rising Medicare Costs!

Join aging advocates in contacting key Republican senators in eight states about protecting seniors in greatest need against rising Medicare premiums. Since 2000, Medicare premiums have more than doubled. The Senate is now crafting a bill designed to increase payments to Medicare physicians, which will increase beneficiary premiums even further. Unfortunately, programs designed to assist poor seniors with these costs are broken and must be fixed. Please contact key Senators about improving the programs designed to protect low-income Medicare beneficiaries against rising costs. The Senators include: McConnell and Bunning (KY), Sununu (NH), Roberts (KS), Collins and Snowe (ME), Coleman (MN), Stevens (AK), Grassley (IA), and Specter (PA).

If you're from one of these states, please take a moment now to call AND e-mail your senator(s). You can call (866) 622-2184 toll-free to be connected to the Capitol switchboard. Ask for your senator by name and feel free to use the following proposed talking points for calls:

[]Since 2000, Medicare premiums have more than doubled. Proposed Senate increases in Medicare physician payments will cause additional increases in beneficiary premiums and make them even more difficult to afford.

[]Unfortunately, programs designed to assist poor seniors with such rapidly rising costs are broken and must be fixed.

[]The Senate Medicare bill will make things worse unless provisions are included to improve assistance for those who can least afford increasing premiums.

[]The bill should simplify and align Medicare low-income assistance programs, bring outdated asset limits in line with today’s cost of living, and improve outreach and participation for those currently eligible.

[]The Medicare bill should help beneficiaries, not just providers. Helping seniors with incomes below $15,000 is as or more important than helping doctors with incomes over $150,000.