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.

Taking A Look at Part D

This week the Kaiser Daily Health Policy Report highlighted a study conducted by the Journal of the American Medical Association on the impact of the Medicare Prescription Drug Benefit.

Two key findings of the study indicated that the overall percentage of seniors who skipped taking medications due to cost issues has decreased since the January 2006 implementation of the Medicare Prescription Drug Benefit. However, the study also showed that there has been no improvement with regard to skipping pills among the sickest participants.

Researchers also found that 60% were unaware their plans had the so-called "doughnut hole" coverage gap. "The new Medicare Part D program provides billions of dollars in new benefits for seniors, but also imposes complex and high levels of cost-sharing," Hsu said in a statement, adding, "The study shows that many seniors have trouble understanding these benefits and that this poor knowledge limits their ability to manage their medication needs and costs" (Dunham, Reuters, 4/22).

For more information about the study please click HERE to visit the Kaiser Daily Health Policy Report or HERE to visit the abstract of the study at the Journal of the American Medical Association.

Comments Please: How have the costs of prescription drugs impacted your life or the lives of your family members?

Continuing the Dialogue

On Wednesday, April 16th, the U.S. Senate Special Committee on Aging held a hearing entitled "Caring For Our Seniors: How Can We Support Those On The Frontlines?". The Committee Chairman, Senator H. Kohl (D-WI) led the hearing. During the hearing Senators engaged in dialogue with distinguished panelists including professors of medicine, geriatrics and aging issues as well as practitioners in those fields. The topics discussed included:

[]Improving training and retention strategies for caregivers;

[]Placing a higher value on geriatric medicine;

[] Recruiting more students and creating more incentives for them;

[]Balancing concerns about the Medicare trust fund and concerns about providing adequate geriatric care including wages;

[]Broad-based approaches to caregiving; and

[]Resources for family caregivers.

The other side of the caregiving issue was also discussed – informal care. An ever increasing number of Americans find themselves caring both for their children as well as their parents. According to a National Alliance of Caregivers (NAC)/AARP survey, in November 2006, between 30 million and 38 million adult caregivers provided care to adults with limitation in an activity of daily living. Caregivers provide on average 21 hours of care per week. About half of caregivers contribute financially to their parent’s budget, spending on average $200 per month or $2,400 per year. According to a 2004 NAC/AARP study, about 23% of caregivers say that caregiving is a financial hardship. The findings of this survey illustrate that 1) many seniors are coming up short financially and rely upon their children to help plug the gap; 2) almost one-fifth of workers are informal caregivers; and 3) when caregivers take time off from work and contribute financially to their parents, they come up short in their retirement and so the cycle continues. Policy must be crafted to address the current shortfalls regarding both formal and informal caregiving. At WOW, we are particularly interested in see parity in part-time work for those finding themselves in need of providing informal care. We also feel strongly about providing professional caregivers self-sufficient wages as well as health and retirement benefits. But this is just the beginning; we need to start to think more holistically about the role of the public and private sector when it comes to caregiving. Our economy can no longer afford to rely upon the private support of families to carry the full responsibility of caregiving. The hearing held on this topic is a good first step in the right direction.

For more information about the witnesses or to read testimony, please visit the U.S. Senate Special Committee on Aging's website by clicking HERE.


Comments Please: What have you experienced in the caregiving industry or family caregiving? What aspects need to be improved upon as older Americans become a significantly larger part of our population?

No Easy Way Out for Seniors

In the midst of our struggling economy and whirlwind of home foreclosures, disturbing predatory practices continue to thrive. Opportunistic and suspect characters are already swindling hard working older Americans out of their opportunity to achieve economic security through homeownership!

According to the National Consumer Law Center (NCLC), there are at least three “foreclosure scams” in play today with our seniors as the number one target - Phantom Help, False Bailouts, and Bait-And-Switch. Each of these practices preys upon seniors teetering on economic insecurity and quickly running low on funds and resources. These lopsided strategies often result in older Americans incurring additional debt and/or having to surrender their most important facet of economic security - their homes.

Thankfully policymakers are taking the time to look at the issue specifically from the perspective of seniors. Recently a hearing was held about the impact of foreclosures on the elderly by the Senate Special Committee on Aging. It was chaired by Senator Herb Kohl (D-WI). It seems foreclosure scammers hone in on elders because in comparison to others they have larger equity on their properties. Although, as the title of this blog suggests, there is no easy way out of foreclosure troubles there are appropriate steps that can be taken and help is available. NCLC suggests the following strategies:

[]Get Legal Advice Immediately;
[]Apply for Income Maintenance, Tax Abatement and Public Assistance Programs;
[]Negotiate with the Mortgage Company or Servicer;
[]Refinance the Home Debt;
[]Consider Selling the House Before Foreclosure; and
[]Consider Filing Bankruptcy.

Most importantly advocates and service providers must inform seniors of these predatory practices and steer them clear of the landmine that they are. As the Elder Economic Security Standard Index demonstrates, assets such as homes are extremely critical to an elder’s economic security. Even so, if an elder must return to renter status by selling their home free and clear, that can be a better alternative to getting caught in the web of these foreclosure scams.

Comments Please: Has someone in your family been approached by a suspect individual suggesting they can "save" them from the housing crisis by entering into a new contract with them?

Today the Tax Policy Center (co-directed by The Urban Institute and The Brookings Institution) hosted an event titled "Race, Ethnicity, Poverty, and the Tax-Transfer System" which was a quite interesting discussion. The main topics were Education, Work and Family Incentives, and Social Security as related to tax policy. As one might expect, the EESI team zeroed in on the third topic.

The panelist discussing Social Security was Melissa M. Favreault, a Senior Research Associate in the Urban Institute's Income and Benefits Policy Center. Ms. Favreault brought up quite a few interesting points regarding low-income older Americans and The Social Security system. Among the most notable are the following, many of which are illustrated by the Elder Standard™ Index:

[]Economic status upon retirement is highly cumulative as various disadvantages compound over a lifetime;

[] For the average low-wage worker, their Federal Insurance Contribution Act (FICA) contribution in combination with the shifted burden of the employee contribution (by a reduction in wages), over a lifetime, often exceeds their take home pay;

[] Because Social Security pays benefits in the form of life annuities, those with longer life expectancy can expect to receive larger payouts. As a result, the literature suggests many men and women of color often pay into the system more than they receive in payout;

[] Many aspects of the Social Security program interact with and exacerbate pre-existing racial disparities;

[] Decoupling supplemental Social Security benefits from marriage and rather directing them toward child care or other dependent care would be the only true way of honoring and compensating caregiving contributions across lines of race, ethnicity and sexual preference;

[] Social Security comprises 90%+ of income for adults 65 and older in the bottom income quintile as compared to just 28% for the middle quintile.

For more information, visit the EESI section of the Wider Opportunities for Women website or contact lbeasley@wowonline.org

Comments Please: Have you experienced the magnification of disparities upon retirement personally or with a family member?