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From the category archives: Disability

GOP Budget Plan: Even More Cuts for Seniors in Medicare

In keeping with every GOP budget passed over many years, benefit cuts for average Americans and tax cuts for the wealthy rule the day.  The Senate this week will pass the Budget Conference Report (it only needs a majority, which the GOP now has) including massive benefit cuts for seniors in Medicare.  

National Committee policy staff has laid out what this Budget bill means for seniors in our letter to the Senate:  

The conference agreement would be devastating to today's seniors and future retirees, people with disabilities and children due to the proposed changes it makes to Medicare, Medicaid and the Affordable Care Act.  While it proposes huge cuts to our social insurance safety net, the conference report would give massive tax cuts to the very wealthy. The conference agreement assumes the privatization of Medicare and achieves savings by shifting costs to Medicare beneficiaries.  Beginning in 2024, when people become eligible for Medicare they would not enroll in the current traditional Medicare program which provides guaranteed benefits.  Rather they would receive a voucher, also referred to as a premium support payment, to be used to purchase private health insurance or traditional Medicare through a Medicare Exchange.  The amount of the voucher would be determined each year when private health insurance plans and traditional Medicare participate in a competitive bidding process.  Seniors choosing a plan costing more than the average amount determined through competitive bidding would be required to pay the difference between the voucher and the plan's premium.  In some geographic areas, traditional Medicare could be more expensive.  This would make it harder for seniors, particularly lower-income beneficiaries, to choose their own doctors if their only affordable options are private plans that have limited provider networks.  Wealthier Medicare beneficiaries would be required to pay a greater share of their premiums than lower-income seniors.

The plan to end traditional Medicare requires private plans participating in the Medicare Exchange to offer insurance to all Medicare beneficiaries.  However, it is likely that plans could tailor their benefits to attract the youngest and healthiest seniors and still be at least actuarially equivalent to the benefit package provided by fee-for-service Medicare.  This would leave traditional Medicare with older and sicker beneficiaries.  Their higher health costs would lead to higher premiums that people would be unable or unwilling to pay, resulting in a death spiral for traditional Medicare.  This would adversely impact people age 55 and older, including people currently enrolled in traditional Medicare, despite the conference agreement’s assertion that nothing will change for them.

The conference report threatens to shift costs to Medicare beneficiaries.  S. Con. Res. 11 contains $431 billion over ten years in unnamed Medicare cuts.  Over half of Medicare beneficiaries had incomes below $23,500 per year in 2013, and they are already paying 23 percent of their average Social Security check for Parts B and D cost-sharing in addition to paying for health services not covered by Medicare.  When coupled with requirements to shift costs to beneficiaries in the Medicare Access and CHIP Reauthorization Act of 2015 (P.L. 114-10), the unspecified Medicare benefit cuts included in the conference agreement would be burdensome to millions of seniors and people with disabilities.

In addition, the conference agreement calls for repealing provisions in the Affordable Care Act (ACA), which would make health insurance inaccessible for seniors age 64 and younger.  Without the guarantees in the ACA, such as requiring insurance companies to cover people with pre-existing medical conditions and to limit age rating, younger seniors may not be able to purchase or afford private health insurance.

Repealing the ACA would also take away improvements already in place for Medicare beneficiaries – closing the Medicare Part D coverage gap, known as the "donut hole"; providing preventive screenings and services without out-of-pocket costs; and providing annual wellness exams.  The Centers for Medicare and Medicaid Services recently reported that since the passage of the ACA, over 9.4 million Medicare beneficiaries in the Medicare Part D donut hole have saved $15 billion on their prescription drugs, an average of $1,595 per person.  An estimated 39 million people with Medicare took advantage of at least one preventive service with no cost sharing in 2014.

The agreement includes reductions to Medicaid funding that would affect low-income seniors.  Medicaid provides funding for health care to help the most vulnerable Americans, including low-income seniors, people with disabilities, children and some families.  The conference report would end the current joint federal/state financing partnership and replace it with fixed dollar amount block grants, giving states less money than they would receive under current law.  In exchange, states would have additional flexibility to design and manage their Medicaid programs.  The proposed block grants would cut federal Medicaid spending by $500 billion over the next 10 years.  Giving states greater flexibility in managing and designing their programs in no way compensates for the significant reductions that beneficiaries, including nursing home residents and their families, could face by turning Medicaid into block grants.

The conference report also would repeal the Medicaid expansion in the ACA. Beginning in 2014, states have had the option to receive federal funding to expand Medicaid coverage to uninsured adults with incomes up to 138 percent of the federal poverty level ($16,242 for an individual in 2015).  Over half of the states have expanded their Medicaid programs, and some others will likely participate in the future.  The conference agreement would hurt states and low-income individuals by repealing Medicaid expansion, taking away $900 billion from the program over 10 years.  Altogether, S. Con. Res. 11 cuts the Medicaid program by more than $1.4 trillion over 10 years, compared to current law.

Moreover, the conference agreement puts 11 million severely disabled Social Security Disability Insurance (SSDI) beneficiaries at risk of a 20 percent benefit cut next year by reaffirming a House rule requiring legislation to address the financing of the SSDI program be accompanied by revenue increases or much more likely benefit cuts.  That’s why the National Committee urges the Senate to reject the House’s SSDI recommendations in the conference report and instead make a modest reallocation of Social Security payroll taxes from the retirement trust fund to the Disability Insurance Trust Fund as has been done 11 times in the past on a bipartisan basis.

The National Committee urges you to oppose the Conference Report on the FY 2016 Budget Resolution, which would be harmful to seniors, people with disabilities and children."

 

 

Cutting Social Security Disability Threatens Millions of American Families

One of Congress’ strongest champions for strengthening and boosting Social Security, Medicare and Medicaid is Rep. Gwen Moore from Wisconsin.  Congresswoman Moore has also been an effective voice in Congress for measures that focus on improving the economic and employment conditions in low-income communities.  We’re so glad she’s agreed to share her views with us on the current Congress, Black History month and recent attempts to target Americans with disabilities by the GOP leadership in the House. 

 


 

Rep. Gwen Moore (D-WI)

Each February, we are reminded of our country’s greatest African American leaders with the celebration of Black History Month. Black History Month provides us an opportunity not only to reflect on those who advocate on behalf of the African American community, but also to examine the critical concerns and issues facing African Americans today. Even with all of the progress made over the past half-century, African Americans still represent a disproportionate share of our nation’s poor. As we work to change the underlying causes for this reality, we must also make sure we’re providing an adequate safety net to prevent further harm of those who are already struggling to get by.

There is no program more vital to protecting those who are battling poverty than Social Security. Not only is Social Security responsible for allowing millions of Americans to enjoy a comfortable retirement after a life of hard work, but also provides insurance for more than 90% of American workers in the event of a debilitating accident or illness through the Disability Insurance program.

On the first day of the 114th Congress, House Republicans pushed through a rule change regarding the Social Security trust funds that would prevent the routine transfer of funds between the retirement and disability accounts. Without the ability to transfer funds, the Disability Trust Fund will be forced to cut all benefits by 20% in 2016. That’s 20% from a paycheck that already is not enough to keep 1.6 million people out of poverty.

A harsh truth we must come to terms with is that one out of every three young workers new to the labor force will either die or need Disability Insurance before they turn 67.  Those odds get even worse for African American workers, who make up a disproportionate percentage of Disability Insurance beneficiaries.  An unexpected disability or illness can be devastating to an individual or family, but the Disability Insurance program supplies protection to soften the blow of an immediate loss of income. While the benefits are modest, averaging around $1100 a month, they still represent the main or only source of income for over 80% of beneficiaries.  Nearly one in five beneficiaries live in poverty, which translates to roughly 1.6 million people, or approximately the population of greater metropolitan Milwaukee, my home city.

Obviously, this critical program needs more funding, but my congressional colleagues across the aisle continue to stand in the way. The rule change proposed by House Republicans was slipped under the wire as a procedural fix. But let’s call it what it is: a brazen attack on our nation’s most vulnerable. These are people who paid their dues to Social Security while they were in the labor force who are now in need of the services they paid into.

Now is not the time to weaken the Disability Insurance program, but rather we should be strengthening it. One of the major lingering effects of the recession is the sharp increase in long-term unemployment. While this number is now on the decline for the overall population, disabled workers continue to struggle to find gainful employment. Cutting what meager benefits they have now would be a death sentence.

This Black History Month, instead of only reflecting on the African Americans of the past, we should also make sure we are taking care of the African Americans of today and tomorrow. Cutting benefits to the Disability Insurance program would disproportionately affect African Americans. I believe in a vision of government where we take care of those who have fallen on hard times due to disability. Black History Month serves as a good means to highlight these issues, but I will keep fighting for this vision all year-round, day-in and day-out, until every American receives the assistance they need to live a prosperous life.

 

Celebrating Black History Month

Social Security is One Program – No Matter How Much Conservatives Try to Pit Seniors Against the Disabled

Tomorrow,  Republicans leading the House Ways and Means Social Security subcommittee will continue their campaign to try and convince Americanswhy it’s OK to threaten a 20% benefit cut for people with disabilities unless Congress enacts larger “reforms” (“reforms” actually meaning benefit cuts since conservatives have already ruled out revenue increases) from retirees, widows and survivors who depend on Social Security. 

This divide and conquer strategy ignores the fact that, once you step outside Congressional hearing rooms, average Americans understand that Social Security’s value goes far beyond just retirement.  Demonizing people with disabilities discounts the basic truth that American workers contribute throughout their working lives into one program -- Social Security.  Their contributions provide economic security for a whole host of needs from birth to death – for children who’ve lost a parent, spouses who’ve lost their “significant other” and people with disabilities no longer healthy enough to work.  Worker contributions provide all of these benefits. Cutting Social Security disability is cutting Social Security benefits, no matter how conservatives in Washington want to pretend otherwise. Targeting one group of Social Security beneficiaries is a political first step to attack the whole program.

Web Phillips is the National Committee’s Senior Legislative Representative and will testify before the committee tomorrow:  

“Our members come from all walks of life and every political persuasion.  What unites them is their passion for protecting and strengthening Social Security and Medicare, not just for themselves but for their children and grandchildren.  Our members see Social Security as an inter-generational compact that protects all members of the family.  To them, it is a single integrated system of benefits that provides family protection from birth to death.  It is a system where all of its parts, whether SSDI or retirement and survivors benefits, are equally important.

Most seniors have children and grandchildren and are as concerned for their offspring’s well-being as they are for their own.  Maybe more so.  They may have had sons and daughters who were born with a disabling condition or who became disabled later in life.  They are familiar with the disappointment and financial hardship unanticipated events cause and are grateful that Social Security is available to provide help when it is needed.  Fundamentally, they understand SSDI’s value and they support the program.”

At the heart of this issue is the GOP’s refusal to simply allow a modest and temporary reallocation of part of the 6.2 percent Social Security tax rate to the DI Trust Fund which would put the entire Social Security program on an equal footing, with all benefits payable at least until 2033. Again, Americans pay taxes to one Social Security system with the understanding their money provides disability, retirement and survivor benefits – all of them – so changing that allocation formula temporarily avoids any shortfall. In fact, Democrats and Republicans have authorized this same strategy eleven times without controversy (including four times during the Reagan administration). Extending the DI Trust Fund’s solvency to match the Retirement Trust Fund is a simple common sense step that sets the table for a more constructive long-term conversation about Social Security between now and 2033, rather than this faux crisis mentality promoted by the billion dollar anti-Social Security lobby and it’s allies on Capitol Hill. 

GOP leaders call this common-sense solution “kicking the can down the road” while they ignore the reality of what a 20% benefit cut would mean to millions of people with disabilities.  It’s a “death sentence” according to Social Security Acting Commissioner, Carolyn Colvin.  She’s right.  However, rather than address this immediate need for Social Security disability beneficiaries, as so many other Congresses have, Republican leaders continue their cynical political attack in which all Social Security beneficiaries are the hostages. 

Will the President Fight for Social Security & Medicare?

President Obama’s State of the Union address to Congress next Tuesday should provide some desperately-needed insight into just how far this administration will go to defend and strengthen America’s two most successful income and health security programs. The new GOP Congress has made their intentions clear by attacking Social Security on Day One of the new session.  The White House; however, remains silent on the GOP’s latest move:

“TPM asked multiple times last week for the White House's position on the House action, but never received a formal response, a stark contrast to the loud public pronouncements of Brown, Warren, and others. It also invokes the uneasy relationship between the White House and Social Security advocates, who were dismayed by Obama's willingness to accept cuts to the program during the 2011 grand bargain talks with House Speaker John Boehner (R-OH).” 

{Update:  The White House did respond after our initial post . A spokesperson told TPM "Generally speaking, the Administration strongly opposes any efforts to undermine Congress’ ability to reallocate funds between the Social Security retirement and disability trust funds," a White House spokesperson told TPM, "as they have done with bipartisan support numerous times in the past in both directions."}

NCPSSM has urged the President to support reallocation, as has happened without controversy 11 previous times, to avoid a massive benefit cut Americans with disabilities simply cannot afford.

“We applaud you for making middle-class mobility and economic equality one of your top priorities.  Social Security helps to provide a lifetime of economic equality by insuring millions of Americans against the risks of retirement, disability and survivorship. 

For that reason, the National Committee urges you to support the reallocation from the OASI Trust Fund to the DI Trust Fund and oppose the House majority’s demand to cut benefits in exchange for addressing the Disability Insurance program’s financing.  Your State of the Union address would be an ideal opportunity to reaffirm your support for Social Security.”  Max Richtman, NCPSSM President/CEO

In truth, the White House could have invested an entire week just responding to all of the attacks launched by GOP Congress in its opening days (so much for working together) so it’s hard to read too much into this silence on Social Security.  However, Tuesday’s State of the Union address should change that.  President Obama must set the tone and make it clear to the House and Senate that cutting benefits to families who depend on Social Security and Medicare is simply not an option. 

While Republicans certainly didn’t campaign on cutting benefits to middle-class families, now that they’re elected, GOP leaders in the House have made it clear that’s exactly their intention.  President Obama’s State of the Union provides an important opportunity to set the record straight and push back on all of the falsehoods currently being used to justify cutting benefits to the middle class.

Here are just some of the more outrageous claims:

The new Chairman of the House Budget Committee, Rep. Tom Price (R-GA), went so far as to create his own set of Social Security numbers to justify the GOP attack by claiming Social Security:

 “is a program that right now on its current course will not be able to provide 75 or 80 percent of the benefits that individuals have paid into in a relatively short period of time …”

There’s nothing about this statement that is true.  Even if Congress does absolutely nothing to improve Social Security’s long-term solvency (and no one believes that will happen) the program would be forced to reduce benefits by about 25% two decades from now. Any benefit cut is unacceptable; however, it’s not too much to expect Congressional Committee Chairmen to stick to the facts. Another House Committee Chairman, the head of the Social Security subcommittee Rep. Sam Johnson (R-Texas), led recent House the effort to hold the Disability program hostage in order to extract cuts program-wide.  He claims:

the program is “plagued by fraud” and that “the public is fast losing faith in Social Security, and I don’t blame them, because I have too.” 

Neither are true. 

The Government Accountability Office found that improper payments of Social Security benefits that include Disability Insurance had an error rate of just 0.6 percent.  SSA’s Inspector General reports less than 1% fraud in the disability program.  Any fraud is too much but what reasonable person would consider  less than 1% of anything a “plague.”

Far from losing faith in Social Security, the American people of all ages and political parties continue to show unparalleled support for the program in spite of Congressional conservatives’ campaign to undermine it. Not only do they support Social Security in its current form, by large margins they’re willing to pay more to improve it and boost benefits. The latest National Academy of Social Insurance survey of Americans found:

Seven out of 10 participants prefer a package that would eliminate Social Security’s long-term financing gap without cutting benefits. The preferred package would:

  • Gradually, over 10 years, eliminate the cap on earnings taxed for Social Security. With this change, the 6% of workers who earn more than the cap would pay into Social Security all year, as other workers do. In return, they would get somewhat higher benefits.
  • Gradually, over 20 years, raise the Social Security tax rate that workers and employers each pay from 6.2% of earnings to 7.2%. A worker earning $50,000 a year would pay about 50 cents a week more each year, matched by the employer.
  • Increase Social Security’s cost-of-living adjustment to reflect the inflation experienced by seniors.
  • Raise Social Security’s minimum benefit so that a worker who pays into Social Security for 30 years or more can retire at 62 or later and have benefits above the federal poverty line.

With this State of the Union, President Obama has an opportunity to provide some truth-telling on Social Security and Medicare while also sending a clear message that the White House will not aide and abet conservatives who intend to cut middle-class benefits to pay for tax cuts for huge corporations and the wealthy.  

We hope the President will join the American people and be bold in the defense and expansion of Social Security and Medicare rather than leave the door open to continued hostage-taking and deal-making designed to unravel the economic security so many Americans depend on.

 

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