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The Senate Still Has a Hard Time Telling Insurers “No”

The differences between Senate and House members trying to negotiate a compromise in their legislation to reauthorize and improve access to healthcare for children, SCHIP, remain. That, in our opinion, is a good thing. Not because we like gridlock but because this legislation is too important to seniors and children alike to take the easy way...which is to ignore the difficult issues tackled in the House bill but absent in the Senate version.

The House bill, called CHAMP, includes desperately needed reforms to private Medicare Advantage plans and is by far the better piece of legislation. Money currently being used to overpay insurers would go to improve health insurance access to children. More than a fair trade. Thankfully, House leaders are sticking to their guns...so far. Congress Daily describes yesterday’s closed door meeting this way:

"Senate Majority Leader Reid, House Majority Leader Hoyer, Senate Finance Chairman Baucus, and House Energy and Commerce Chairman Dingell attended the meeting in House Speaker Pelosi's office to discuss how to approach a conference report that would merge the bills. They made no decisions. 'We've got to find out how close are we. We know how far apart we are just without talking,' Rangel said. 'They cannot make commitments on their side, and we damn sure can't on ours, to say that we're compromising when we don't even know where we are.' From Rangel's perspective, ripping apart the House package might threaten its majority support. 'We put the baby together, and we made the baby with [Energy and] Commerce Committee and the Ways and Means committee, our caucuses, liberals, Democrats, pro-tax, anti-tax, cigarette people. We put this child together. And to split the child in half is very, very difficult to sell it to the parents,' he said."

While every major seniors and health advocacy organization (including the AMA and AARP) supports cutting millions in outrageous overpayments to private MA insurance companies and using that savings to improve insurance access for children...you can see just how much influence the insurance lobby still has on Capitol Hill...

“Before the meeting, Baucus said it would be very difficult to get the needed 60 votes for a conference report in the Senate if any Medicare provisions are added. Several Republican supporters of the Senate bill say they will not tolerate cuts to private Medicare Advantage programs that are part of the House bill.” Congress Daily AM, Sept 7, 2007

So in short, some in the Senate just "won’t tolerate" cuts to private plans which pay private insurers about $1,000 more than Medicare receives for the same beneficiary. They "won’t tolerate" cutting industry subsidies which will cost taxpayers $149 billion dollars over the next decade and cuts two years from Medicare’s solvency. And let’s not forget the extra $24 a year every Medicare beneficiary is paying to cover these subsidies...whether they’re in a private plan or not.

Clearly, the insurance industry does not want to lose the MA gravy train and it's lobbying hard to protect the sweetheart deal it wrote and passed through Congress in the 2002 Medicare Privatization...oops, we mean Modernization...Act.

That’s why we say in this instance...differences are a good thing. And we urge Senate to find the same courage their colleagues showed in the House and support SCHIP legislation that considers what’s best for children and seniors alike.

The Insurance Industry Hits a New Low

No doubt, you’ve seen AHIP’s (America’s Health Insurance Plans) television ads designed to scare seniors into believing that cutting millions in industry subsidies is somehow the same as cutting Medicare. This weekend, their president penned a letter to the Washington Post continuing the intergenerational war refrain, which has become a popular marketing ploy used by the Bush administration whenever it wants to scare one age group or the other.

If you want to get beyond the rhetoric, check out Robert Laszewski’s post today at the Healthcare Policy and Marketplace Review blog. He contrasts AHIP’s main points with the truth, such as:

“The Congressional Budget Office predicts that 3 million seniors—mostly rural Americans—will lose their Medicare Advantage coverage altogether if the House bill becomes law.” I am sure that is right. But the CBO is right more because the plans that have been gaming the Private Fee For Service payment system won’t any longer be able to do it and will leave those markets.

And then the big one: “There’s no justification for pitting children against seniors.” Damn right. So, why are you making this into a kids versus seniors issue?

While we don’t agree with all of Laszewski’s conclusions, it is refreshing to see someone looking past the PR to the actual truth of the matter. The post's discussion also provides more thoughtful insight into this "seniors versus children" propaganda.

The real question is...Can those who actually care about sensible healthcare options for seniors and children cut through this million dollar industry marketing blitz to persuade the Senate to take the House’s lead on SCHIP and MA reform?

Here’s a letter we’ve sent to the Senate urging they consider legislation that improves children’s healthcare access through SCHIP while also making desperately needed reforms to private Medicare Advantage plans.

Let’s Set the Record Straight…One last time

Ask Mary Jane, NCPSSM Contributor: Mary Jane Yarrington, Senior Policy Analyst

“I’ve contributed 40 hours to Social Security but can’t collect my benefit”…Yes, you can.

Here’s a sampling of the different ways the myth surrounding the Windfall Elimination Provision comes to me from questioners:

“My wife heard that she won't be able to collect her own SS at retirement age because she will collect from a school retirement plan. Can that be true?”

or

“When I went to the Social Security office I was devastated to learn that I would never receive any social security benefits (even though I have a minimum of 40 credits). I never knew such a thing as the Windfall Elimination Provision existed”

In short, if you hear “you can’t collect any of your Social Security” because of the WEP then you have been misinformed. Any citizen or legal resident who earns 40 quarters of Social Security coverage is entitled to a retirement benefit at retirement age. There are no exceptions.

The Social Security Act’s Windfall Elimination Provision (WEP) requires the determination of a Social Security benefit by a separate, lower benefit calculation. This applies if the wage earner contributed to a pension rather than Social Security, for example, some state, local and federal pensions. The benefit is reduced, but never to zero.

If you were given misinformation by the Social Security Administration, go to your local Social Security office and insist on filing an application dated retroactive to the date you were told you were ineligible for a benefit. There is no time limit on correcting administrative errors.Do you have questions about Social Security? If so, feel free to drop me an email at Ask Mary Jane.

Let’s Set the Record Straight

Ask Mary Jane, NCPSSM Contributor: Mary Jane Yarrington, Senior Policy Analyst

It’s been said a “lie told often enough becomes the truth”. How sadly true, especially for those determined to convince future generations that Social Security just won’t be there for them. Not a day goes by that I don’t see the same old myths about Social Security appear in news articles, speeches by elected leaders (who should know better) and seniors who’ve been scared by these malicious myths. For the next few days I’ll offer some Social Security Myth-busting…Mary Jane style.


“Members of Congress don’t contribute to Social Security”…Wrong

Congress got the message years ago and since 1983 all members of Congress, Executive Office appointees, the President, Vice President , the federal Judiciary and newly hired federal employees have been paying into Social Security. Unfortunately, here we are 24 years later and some just won’t let this one go (even though it’s just not true).

All Federal employees, including Members of Congress, pay the same FICA payroll tax as anyone else. Upon retirement, disability or death, Social Security benefits for a Member of Congress or his or her dependents is determined under the same rules and by the same calculations as any other worker who contributed to Social Security.

Do you have questions about Social Security? If so, feel free to drop me an email at Ask Mary Jane.

Let’s Set the Record Straight…Again

Ask Mary Jane, NCPSSM Contributor: Mary Jane Yarrington, Senior Policy Analyst

“Social Security is a Ponzi Scheme” …No it’s not.

Anyone who tells you Social Security is a Ponzi scheme either doesn't understand what a Ponzi scheme is or their mother’s didn’t teach them not to fib. This myth is a favorite of conservatives who just hate the idea of social insurance in general. The Social Security Administration has a good history describing why this is nonsense. But here’s my take on this myth.

A Ponzi scheme is that e-mail you receive inviting you to send a fancy guest towel to the top three names on a list and instructing you to cross off the first name, add your name and send the same e-mail to three others. Whoever starts the list likely will receive the towels, but ultimately, there is no one left to continue the chain. The final entrants won’t receive anything. The original Ponzi played the game with dollars but the principle is the same. He borrowed money from his first investors and paid them back with money obtained from subsequent investors. He quickly ran out of sufficient investors to keep his scheme going.

Social Security is not a Ponzi scheme. Social Security is a pay-as-you-go system with the contributions of today’s workers going to today’s retirees or into the reserve to pay benefits to future retirees. The ratio of workers to retirees has changed over time, but unless this nation allows the system to be abolished, there will never be a time of no workers paying into the system. The most recent report of the Social Security Board of Trustees forecasts that even with no changes in the system, reserves will last through 2041 and even after that, 75% of promised benefits could be paid with incoming payroll taxes.

And don’t give any credence to the nonsensical comparison that in 1940 there were 40 workers to each retiree and today it is only three to one. Of course, there were fewer beneficiaries. 1940 was the first year a benefit was paid so millions of then-retired workers didn’t have the opportunity to contribute payroll taxes and earn benefits. Many of those ineligible for benefits in 1940 then relied on public assistance or their children to survive their retirement years. Hardly the “good old days” those who hate Social Security should be so eager for us to return to.

Do you have questions about Social Security? If so, feel free to drop me an email at Ask Mary Jane.



   

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