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From the category archives: entitlement reform

House GOP Recklessly Pursues Privatization of Medicare in Budget Process

Congress is targeting the health and financial well-being of America’s seniors by making yet another attempt to privatize Medicare.   Yesterday the House Budget Committee passed the GOP’s FY 2018 budget resolution, which includes Speaker Paul Ryan’s “Medicare premium support” scheme – an innocuous name for turning time-tested senior health care coverage into “Coupon-Care.”  

The House budget blueprint slashes nearly $500 billion from Medicare over ten years and raises the eligibility age from 65 to 67 – along with gutting Medicaid and other social safety net programs for needy seniors.  

The Associated Press had a pithy summary of the painful cuts that the GOP proposes in its new budget:

“The plan, in theory at least, promises to balance the budget through unprecedented and unworkable cuts across the budget. It calls for turning this year's projected $700 billion or so deficit into a tiny $9 billion surplus by 2027. It would do so by slashing $5.4 trillion over the coming decade, including almost $500 billion from Medicare, $1.5 trillion from Medicaid and the Obama health law, along with enormous cuts to benefits such as federal employee pensions, food stamps, and tax credits for the working poor.” – Associated Press, 7/18/17

 National Committee President Max Richtman says that converting Medicare into a voucher program is an existential threat to the program itself. 

 “Over time, giving seniors vouchers to purchase health insurance would dramatically increase their out of pocket costs since the fixed amount of the voucher is unlikely to keep up with the rising costs of health care. And, as healthier seniors choose less costly private plans, the sicker and poorer seniors would remain in traditional Medicare, leading to untenable costs, diminished coverage, and an eventual demise of traditional Medicare, plain and simple.” – Max Richtman, NCPSSM President

Of course, raising the Medicare eligibility age from 65 to 67 as the House spending plan also proposes, is in itself a drastic benefit cut.

Undermining Medicare has been a long-held dream of fiscal conservatives. Their “premium support” proposal is a thinly veiled scheme to allow traditional Medicare to “wither on the vine,” as former House Speaker Newt Gingrich once put it.

Privatization is being sold as “improving customer choice,” but based on the way current Medicare Advantage plans work, private insurance will continue to offer fewer choices of doctors than traditional Medicare does.  If traditional Medicare is allowed to shrink and collapse, choice will disappear, too.

“Weakening Medicare is a politically perilous path for Republicans.  Recent polling indicates that large majorities of Americans across party lines prefer that Medicare be kept the way it is, not to mention that President Trump repeatedly promised to protect the program during the 2016 campaign.” – Max Richtman, NCPSSM President

Meanwhile, the National Committee strongly condemns other priorities of the House Republican budget resolution, as well.  The GOP budget resolution will mean: 

*Hundreds of billions in painful cuts to Medicaid, which seniors depend on for long-term care services and supports.

*Reaffirmation of a House rule that puts 11 million Social Security Disability Insurance (SSDI) beneficiaries at risk of a 7% benefit cut in 2028.

*Reductions to SSI (Supplemental Security Insurance), which provides cash assistance to low-income seniors and people with disabilities.

 *Caps on non-defense spending that will likely lead to devastating cuts to Older Americans Act programs and the Social Security Administration (SSA) operating budget.

 *Slashing of programs that benefit our nation’s veterans and deep cuts to spending on medical research (including cancer, diabetes, heart disease, and other conditions afflicting the elderly).

The savings from these devastating cuts will likely go to tax breaks for the wealthy.  Last year’s House Republican tax plan gave 99.6% of its benefits to the top one-percent of earners, with virtually nothing for middle and low income Americans.

 

 

Massachusetts Congressman is an Unassuming, Unrelenting Champion of Social Security

This morning National Committee President Max Richtman interviewed a real fighter for Social Security and Medicare on Facebook Live from Capitol Hill – Congressman Richard Neal (D-MA-1). 

The Congressman, who the Boston Globe called “an unassuming everyday guy from Western Massachusetts,” has a unique vantage point on seniors’ issues.  He is the ranking member of the powerful House Ways and Means Committee, which oversees (among other things) Social Security, Medicare, Medicaid, and taxes.  He assumed the post just before President Trump arrived in Washington, and has become a key point person against a Republican assault on these programs.

Neal is a true believer in Social Security, partly because he grew up with it.  He and his sisters were raised by an aunt in Springfield, MA after their parents died, and relied on Social Security survivors’ benefits to make ends meet and remain under one roof.  “Social Security allowed us to live as a family, and I’ve never forgotten that,” Neal told Max Richtman.

The Congressman is determined that Social Security be preserved for future generations – without benefit cuts – as a singular form of retirement insurance.  “You can outlive an annuity.  You cannot outlive Social Security,” he said on Facebook Live.  “That’s the guarantee.  That’s the genius of Mr. Roosevelt’s program.”  (Social Security was signed into law in 1935 by President Franklin D. Roosevelt, father of National Committee founder James Roosevelt, Sr.)

Social Security, Neal says, gives American families a modicum of financial predictability for their senior years.  He told the Globe that Social Security “is the reason Mom and Dad aren’t living in your attic.”

Neal is co-sponsoring Connecticut Rep. John Larson’s Social Security 2100 Act – one of the Democrats’ resounding replies to Republican schemes to shrink the program.  Larson’s bill keeps Social Security solvent for decades without cutting benefits.  In fact, The Social Security 2100 Act modestly increases benefits.  Rep. Neal admits that the bill probably won’t go very far while Republicans control Congress.  But he says the legislation “invites fresh thinking about how to encourage growth in Social Security.”

Meanwhile, the Congressman vehemently opposes a bill from House Social Security Subcommittee Chairman Sam Johnson (R-TX) that would do the opposite of Larson’s – reducing cost-of-living adjustments, raising the retirement age to 69 and cutting the benefit-computation formula. All of this, Neal says, would amount to a 30% cut in benefits for middle-class retirees.

Neal shoots down conservative arguments that Americans’ increasing longevity justifies raising the retirement age.  Without Social Security, nearly half of our nation’s seniors would live in poverty – all the more reason, Neal says, not to pull the rug from under retirees by delaying eligibility for benefits.  “We applaud each other regularly for increases in life expectancy in America,” says Neal.  “But all that means is that we have to reinforce the guarantees that Social Security provides.”

Paul Ryan's Medicare Privatization Scheme Edging Closer to Reality

Paul Ryan’s dystopian dream of privatizing Medicare may soon come true.  At least he seems to think so.  In an interview with right-wing Wisconsin radio host Vicki McKenna, the House Speaker said that Medicare “reform” is coming to the Capitol this Spring.  “I’m pretty sure the budget committee in the House will pass that on in the House Republican budget,” Ryan said.  In fact, House Budget Committee Chair Diane Black (R-TN) has already promised to include Medicare privatization in the budget resolution next month.  This is scary news for millions of current and future retirees.

To justify his Scrooge-like assault on Medicare, Ryan continues to perpetuate the myth that Medicare is an “entitlement.”  In fact, it is a remarkably efficient social insurance program.  Having paid into it their entire working lives, Americans are counting on having affordable health care coverage to protect them upon retirement.  Why does Paul Ryan want to take that away, effectively reneging on the nation's commitment to current and future retirees? 

In the past, President Obama stood as an impenetrable barrier between Ryan and his privatization scheme.  Though candidate Trump promised “not to touch” Medicare, the President has already broken that pledge by supporting the GOP healthcare plan, which shortens the solvency of the program.   Despite Trump’s campaign promises, his budget director refused to publicly discourage Congress from privatizing Medicare.  In fact, Speaker Ryan said in his radio interview that he and the Trump administration are having “an ongoing conversation” about it. Current and future retirees clearly cannot trust this White House to protect their Medicare benefits, which they have paid for during their entire working lives.

As we discussed on our "Behind the Headlines" Facebook Live broadcast Thursday, here is what Ryan’s insidious “reform” would do:  Instead of receiving guaranteed benefits, all Medicare participants would be given vouchers to help pay premiums for traditional Medicare or private health insurance.   In either case, the vouchers would not be able to keep up with rising health care costs, leaving seniors to cover the difference out of their own pockets.  That’s why we call the voucher program “coupon care.” 

Ryan's plan would likely drive healthier, younger and wealthier seniors toward private insurance. Poorer and sicker seniors would remain in traditional Medicare, driving up costs until the program collapsed under its own weight.  But that’s not all.  Ryan also wants to hike the Medicare eligibility age from 65 to 67.  This in itself is a massive benefit cut, as 65 and 66 year olds would have to buy private insurance on their own dime. Those who couldn’t afford it might go without health insurance entirely. In a recent National Committee poll, 65% of likely voters opposed raising the eligibility age.  Among younger voters, the opposition was even stronger.

As Ryan predicts, Medicare privatization will likely pass the House as part of the Republican budget resolution.  Its future in the Senate is less certain, but too close for comfort.  Senate Republican leaders need only 50 votes to wreck Medicare.  The National Committee is building a “firewall” of moderate GOP Senators who we believe can be convinced to protect Medicare.  With an unpredictable President in the White House, that is the best way – along with vocal grassroots activism – to defend current and future retirees against the destruction of a program that has worked effectively for more than 50 years, and enjoys enduring public support.

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Trump & GOP Should Do More than Pay Lip Service to Older Americans Month

May is Older Americans Month.  It began in 1963 as “Senior Citizens Month” by proclamation of President John F. Kennedy.  His proclamation half a century ago was not only an acknowledgment of seniors’ contributions to society, but an inspiring call to action:


“I urge all persons and public and private organizations to cooperate in its observance by increasing community awareness of the problems faced by older men and women, strengthening services and opportunities to meet their special needs… and making this special month the beginning of continuing interest and activity on their behalf.” – John F. Kennedy, April 18, 1963

 

At the time, approximately 33 percent of seniors in America lived in poverty. Today that figure is down closer to 10 percent, thanks in no small part to federal programs designed to buttress the financial and health security of older Americans, including Medicare and Medicaid – signed into law by President Lyndon B. Johnson in 1965.  LBJ also renamed Senior Citizens Month “Older Americans Month” that same year upon passage of the Older Americans Act.  This legislation created new forms of federal assistance for seniors – including Meals on Wheels and home heating assistance.  Every President since has issued proclamations honoring seniors during the month of May.  President Trump is no exception.  Today, the White House released a statement saying:


We… recommit ourselves to ensuring that older Americans are not neglected or abused, receive the best healthcare available, live in suitable homes, have adequate income and economic opportunities, and enjoy freedom and independence in their golden years.” – White House proclamation, 5/8/17


These sentiments sound quite noble.  But the Trump proclamation is an empty missive in light of the administration’s policies. National Committee President Max Richtman called out the President and his party in The Hill newspaper last week:


“May is Older Americans Month, but the Trump administration and Congressional Republicans are putting a serious damper on the celebration.” – Max Richtman, The Hill newspaper.


The Trump administration and its allies on Capitol Hill are engaged in a historic reversal of the promises of 54 years ago. In fact, not since President George W. Bush tried to privatize Social Security in 2005 have seniors’ programs been so much under siege.  In a little more than 3 months in office, here is what the President and/or Republicans in Congress have done to undermine the economic and health security of older Americans:

*Passed the American Health Care Act (AHCA), which weakens Medicare, cuts $1 trillion from Medicaid, and makes private health insurance unaffordable for most older Americans.

*Created a budget plan which eliminates federal funding for Older Americans Act programs including Meals on Wheels, community service jobs, and home heating assistance, among others.

*Pledged to turn Medicare into a voucher program during the mark-up of the FY 2018 budget later this month.

*Introduced a House bill to raise the Social Security retirement age to 70 and slow the growth of Cost-of-Living adjustments (COLAs), effectively cutting benefits 30%.

*Repeatedly pushed the concept of “entitlement reform” and questioned the validity of Social Security Disability insurance

Several of these break President Trump’s campaign promises “not to touch” Social Security, Medicare and Medicaid.  Some in the administration and Congress have attempted to fudge the issue by saying that none of their policies will affect current retirees.  But during this Older Americans Month, it’s wise to remember that all of us will be seniors some day.  Attempts to cleave today’s and tomorrow’s seniors is a cynical ploy that cannot be allowed to undermine time-honored programs that have helped older Americans for decades.  None of the actions of President Trump, his team, and his allies in Congress honor the spirit of Older Americans Month.  Much more fitting are the words of President Obama last night as he accepted an honor named after the President who created Older Americans Month, the John F. Kennedy Profiles in Courage award.

“… It actually doesn’t take a lot of courage to aid those who are already powerful, already comfortable, already influential — but it does require some courage to champion the vulnerable and the sick and the infirm.” - President Obama, 5/7/17

Seniors citizens are among society’s most vulnerable and infirm members. We must demand that our current elected leaders do much more than pay lip service to the ideals of Older Americans Month.


Ryan's Siren Song of Spring: Cut "Entitlements"

Along with Cherry Blossoms and the White House Easter Egg Roll, Spring has brought fresh talk of “entitlement reform” to the Nation’s Capital.  Of course, Social Security and Medicare are not “entitlements.”  They are earned benefits that Americans pay into during their working lives in exchange for retirement and health benefits during their senior years.  Nevertheless, House Speaker Paul Ryan and other budget hawks prefer to perpetuate the “entitlement” myth.  This week, Ryan said that fiscal responsibility means “reforming our entitlement programs.”  “Reforming” is code for undermining Social Security and privatizing Medicare, two politically unpopular ideas that nonetheless seem to drive Ryan’s agenda.  Never mind that Social Security and Medicare Part A are funded by workers’ payroll contributions and don’t contribute a penny to the deficit.  

Meanwhile, House Budget Committee Chairwoman Diane Black (R-TN) is looking to end traditional Medicare through the budget reconciliation process in May, according to Congressional Quarterly.

“The coming fiscal 2018 plan is likely to include proposals to transform Medicare… into a premium support program.  Under one House GOP model… people would be given a choice of traditional Medicare or insurer-run plans starting in 2024.” – Congressional Quarterly, 4/27/17

 “Premium support” is an innocuous sounding term that could have dire consequences for seniors.  What Diane Black means by “premium support” is converting Medicare into a voucher program.  Seniors would be offered the option of leaving traditional Medicare to buy insurance in the private market using vouchers.  These vouchers could never keep pace with rising premiums, meaning seniors would have to cover the difference or drop health insurance entirely.  Older and sicker seniors would likely remain in conventional Medicare, causing the program’s cost to skyrocket, benefits to be cut, and eventually the death of Medicare itself.

The canard that Ryan and his party use to justify cutting benefits, reducing COLAs, and raising retirement ages is that Social Security and Medicare are going “bankrupt.” While it’s true that the trust funds for Social Security and Medicare Part A won’t be able to pay full benefits after 2034 and 2028 respectively without corrective action, there are modest and manageable solutions that won’t hurt the seniors who depend on them.  Senator Bernie Sanders and Congressman John Larson (D-CT) have both offered common sense legislation to keep Social Security solvent for decades.  Both bills ask the wealthy to pay their fair share by scrapping the income cap on payroll taxes.  Larson’s legislation also increases the FICA tax by 1% over 25 years.  (Larson says that for a worker earning $50,000 a year, the payroll tax bump equals one Starbucks coffee drink every 9 weeks). Instead of cutting benefits for our most vulnerable citizens – or raising the retirement age – these bills actually increase benefits and COLAs. 

Medicare could be kept solvent well into this century by similarly modest and manageable means, if budget hawks like Ryan would stop insisting that privatization is the only fix. Congress could authorize Medicare to negotiate prescription drug prices (one of the biggest drivers of rising health care costs).  Innovative methods for saving Medicare costs under the Affordable Care Act, many of which have already reduced healthcare expenditures, could be expanded instead of repealed.  In fact, the Affordable Care Act itself extended the solvency of Medicare by four years.  Repealing the ACA – as Ryan and President Trump are still struggling to do – hurts the long-term solvency of the program.

Ryan and many conservative Republicans ignore these alternatives because, at heart, they do not believe in federal programs that provide Americans with retirement and health security – which puts them at odds with the majority of voters. The latest National Committee poll indicates wide public support for progressive solutions for Social Security and Medicare – and significant opposition to the GOP approach. Seventy-nine percent favor increasing Social Security benefits by scrapping the payroll tax income cap.  Sixty-five percent oppose raising the Medicare eligibility age.  Ninety-three percent want Medicare to be able to negotiate prescription drug prices with pharmaceutical companies.

The National Committee’s social media community seems to agree.  Comments on our Facebook posts over the past three months demonstrate deep skepticism about Republican talking points:

Bruce W. These programs are NOT "entitlements"--we have paid into them our entire working lives. If the income subject to SS fees was raised SS would be solvent for decades...
Suzanne S. Social Security has nothing to do with the deficit. It is a stand-alone program funded by workers. LEAVE IT ALONE.
Tom S.  Social Security and Medicare are lifelines to millions of seniors; anyone who votes in favor of cutting or reducing benefits should be ashamed of themselves!
Adam R.  Social Security has nothing to do with the general budget at all. FACT. It is not an entitlement, This is basically a Trust fund we have paid into all our working lives.

Americans intuitively understand that Social Security and Medicare are social insurance programs that they have already paid for through their hard-earned wages.  For 82 years and 52 years respectively, these programs have worked efficiently to keep seniors healthy and out of poverty.  Our Facebook commenter is perfectly correct to call them “lifelines to millions of seniors.”  Yes, their finances need to be shored up. But asking beneficiaries to bear the burden is not the right way. It’s too bad that some of our most powerful political leaders do not seem to understand… or care.

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