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A Dangerous New Year for Social Security, Medicare, and Medicaid

At a family gathering over the holidays in Florida, the conversation inevitably turned to politics.  Some of the seniors at the table who voted for Trump expressed their certainty that no one in Washington will really touch their earned benefits.  “Trump’s not going to let the Congress cut Social Security,” said a Great Aunt in her 70s.  “Paul Ryan’s not really going to mess with Medicare,” insisted her husband. Of course, these beloved family members could not be more wrong.

Their complacency (or, in this case, complicity) sets up a dangerous opportunity for the GOP-controlled 115th Congress, which was just sworn in yesterday.  Claiming a mandate that most certainly does not exist, Congressional Republicans are rolling out proposals that will destroy Social Security and Medicare as we know them, not to mention deep cuts to Medicaid and the repeal of the Affordable Care Act.  These actions will hurt not only the seniors at the holiday table, but their children and grandchildren, too.  As we have been warning for years, all Americans have a lot to lose if these programs are compromised by capricious politicians.

President-Elect Trump shows no signs of honoring his campaign pledge not to touch Social and Medicare.  He has been strangely silent about Congressional proposals that will wreck these two programs, and his appointments to crucial administration positions speak volumes – most notably Rep. Tom Price (a notorious privatization proponent) as Health and Human Services Secretary and Rep. Rick Mulvaney (a fiscal hardliner) as director of the Office of Management and Budget --- a likely ally for Congressional Republicans looking to cut entitlements.

A quick survey of GOP proposals shows just how much current and future beneficiaries of these crucial income security programs have to lose.  House Social Security Subcommittee Chair Sam Johnson (R-TX) has introduced a so-called Social Security “reform” bill that will result in benefit cuts, raise the retirement age to 69, and reduce Cost of Living Adjustments (COLAs) that seniors on fixed incomes rely on.  House Speaker Paul Ryan, who Tuesday gaveled the 115th Congress into session, has long promised to privatize Medicare, turning it into a voucher (or “Coupon Care”) program that would leave future beneficiaries to fend for themselves in the private insurance market while traditional Medicare slowly dies.  This will mean skyrocketing premiums and reduced coverage for seniors thrust into the private insurance market.

The 115th Congress just took the first procedural steps to repeal the Affordable Care Act, which not only jeopardizes health care coverage for 30 million Americans, but puts real improvements to Medicare at great risk.  If the Affordable Care Act is recklessly repealed, seniors will lose free preventative screenings under Medicare.  The Part D prescription drug “donut hole” will open up again, costing more than 11 million Medicare beneficiaries $2,100 per person on prescriptions.  Worse yet, Medicare beneficiaries will face higher premiums and deductibles to make up for the roughly $800 billion in cost savings that the ACA provided over 10 years.  Insurers will once again be able to overcharge or deny coverage to people with pre-existing conditions.

Combine this with GOP plans to block-grant Medicaid, which millions of seniors depend on for nursing home care and long term care services, and Americans are confronting a full-fledged assault on their earned benefits and income security.  As the 115th Congress convened yesterday, Democrats promised vigilance.  Incoming Senate Democratic leader Chuck Schumer declared from the Senate floor, “We demand that (Trump) keep his promise not to cut Social Security and Medicare… We will hold the President-elect accountable.”  On GOP efforts to dismantle the Affordable Care Act, Schumer warned, “It is not acceptable to repeal the law, throw our health care system into chaos” and leave the solution for another day.  Senator Bernie Sanders has called for a national Day of Action on January 15th “to oppose any cuts to health-care plans or subsidies,” including rallies in Congressional districts across the country.

We stand with our allies on Capitol Hill, our fellow advocacy groups, and our millions of members to protect Social Security, Medicare, Medicaid, and the Affordable Care Act.  We see the danger quite clearly… and hope that the seniors and their families who sat around holiday tables the past two weeks will, too.

 

 

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Republican Senators Say Now’s the Time to Cut Social Security, Medicare & Medicaid

A group of freshman GOP Senators has decided the time is right to launch a frontal assault on funding for Social Security, Medicare and Medicaid.  Led by Georgia’s David Perdue, the conservative Senators claim the only way to tackle the nation’s debt is to fundamentally change the way America’s earned benefit programs have been managed since their creation. 

Specifically, they want to give Congress new authority to cut benefits each year (or at least every other year) including the creation of arbitrary spending caps.  Both moves ignore the unique nature of how Social Security and Medicare are funded; specifically, the fact that American workers contribute to these earned benefits through their payroll taxes.

“We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program.”...President Franklin Roosevelt

“In the 1983 Social Security Amendments a provision was included mandating that Social Security be taken "off-budget" starting in FY 1993. This was a recommendation from the National Commission on Social Security Reform (aka the Greenspan Commission). The Commission's report argued: "The National Commission believes that changes in the Social Security program should be made only for programmatic reasons, and not for purposes of balancing the budget. Those who support the removal of the operations of the trust funds from the budget believe that this policy of making changes only for programmatic reasons would be more likely to be carried out if the Social Security program were not in the unified budget." (Note that this was a majority recommendation of the Commission, not the unanimous view of all members.) This change was in fact enacted into statute in the Social Security Amendments of 1983, signed into law by President Reagan on April 20, 1983.”...Social Security Administration

For years, the billion dollar anti-Social Security lobby and their allies in Congress have tried to use our nation’s economic woes as an excuse to cut the earned benefits that millions of average Americans have paid for and depend on. This latest effort would put Social Security and Medicare on the chopping block for each and every budget battle.

Not surprisingly, Republican spin-meisters acknowledge that the vast majority of Americans, no matter their political affiliations, oppose cutting Social Security and Medicare to balance the budget.  Their solution?  Just don’t admit that’s the goal.  Instead, stick to talking points that promise you’re “saving” the program rather than the truth...that you’re slashing benefits:

“Republican pollster Whit Ayres says that despite the long-held conventional wisdom, it’s not suicide to talk about entitlement reform right before an election. But he cautioned senators to proceed cautiously.

‘Here’s what voters want to see: A healthy and thriving Social Security and Medicare system,” Ayres said. ‘If Social Security and Medicare are going to be jeopardized without any changes, then voters will support changes.’ 

 But he warned that entitlement reforms have to be framed as proposals to extend the solvency of Social Security and Medicare and not primarily as a strategy to balance the budget. 

‘The Democrats then come along and say we should not balance the budgets on the backs of our seniors and they win the argument,” he added. “But it’s very effective to argue that we have to reform our entitlement programs to preserve and protect those programs for current and future generations.’ ...The Hill, 10/1/16 

In an attempt to appeal to America’s (understandable) frustration with Congress (or more likely to deflect attention away from this attack on middle-class benefits) these GOP Senators suggest that if Congress doesn’t pass a budget (which could include cuts to Social Security and Medicare) then lawmakers would be penalized with a “steep reduction” to their paychecks. While that might make the populists out there say, “it’s about time,” don’t forget the fact that the majority of U.S. Senators are millionaires. You can be sure that the Social Security and Medicare benefit cuts they propose for you will hurt far more than any threat to trim Congressional salaries: 

“The median net worth for all senators increased to $2.7 million from $2.5 million, but in that body it was the Republicans who were better-off. Senate Democrats reported a median net worth of $1.7 million (a decline from 2011’s $2.4 million), compared to Senate Republicans, at $2.9 million (an increase from $2.5 million).”...Open Secrets 

Seniors should not fall for this political bait and switch. If Congress really wants to strengthen Social Security and Medicare for future generations then let’s talk about lifting the payroll tax cap or allowing Medicare to negotiate for cheaper prescription drug costs. However, you won’t see these proposals offered by fiscal hawks. Why? 

Because they don’t cut benefits. That’s what this is all about.

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New Medicaid Rules Designed to Put Care Over Profit

CMS has announced tightened Medicaid rules for private insurance plans that administer most Medicaid benefits for the poor. The Obama administration says the rules will limit profits, ease enrollment, require minimum levels of participating doctors and eventually provide quality ratings.  However, those ratings would still be years away as the industry continues to fight against such measures. 

Kaiser Health News provides details on the biggest changes for Medicaid managed care in a decade.  The new rules will:

  • Require states to set rules ensuring Medicaid plans have enough physicians in the right places. The standards will include “time and distance” maximums to ensure doctors aren’t too far away from members.
  • Limit insurer profits by requiring rate setting that assumes 85 percent of revenue will be spent on medical care. Unlike a similar rule for other plans, such as insurance sold through Obamacare marketplaces, the requirement would not compel Medicaid insurers to rebate the difference if they don’t hit 85 percent. Future rates would be adjusted instead.
  • Make plans regularly update directories of doctors and hospitals. A 2014 investigation by the Department of Health and Human Services’ inspector general found that half the doctors listed in official insurer directories weren’t taking new Medicaid patients.
  • Push plans to better detect and prevent fraud by providers, including mandatory reporting of suspected abuse to the states.
  • Tighten rules for Medicaid plans and states to collect patient data and submit it to HHS.
  • Make it easier for states to offer managed-care plans incentives to improve clinical outcomes, reduce costs and share patient information among hospitals and doctors.

Nearly two-thirds of Medicaid’s 72 million member are enrolled in private managed-care plans.  Consumer advocates have pushed HHS to set stricter rules for managed-care plans, which they said too often favored profits over patients. The industry and some state Medicaid directors resisted, saying plans needed flexibility to serve different members in different states.

The rules will be phased-in over the next three years, starting next summer. 


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Social Security & Medicare Finally a Topic of Debate

Ok, not a debate so much as a battle to see who can cut seniors’ benefits faster.  While Trump remains the only GOP Presidential candidate who promises he won’t cut Social Security, even that promise became squishy last night.  More on that, later. 

Here’s just a sampling of some of last night’s comments on what the remaining GOP candidates plan for generations of American families counting on Social Security, Medicare and Medicaid, followed by our comments:


Senator Marco Rubio

Social Security will go bankrupt and it will bankrupt the country with it.”

This is conservatives’ favorite lie.  Social Security isn’t going bankrupt.  According to SSA actuaries, the nearly $3 Trillion Trust Fund will be depleted in 2034 (as planned) to cover the baby boomer generation.  After that, there will still be enough income coming into the program to pay 79 percent of all benefits owed. If Congress does nothing seniors will face a 21% benefit cut.  A 21% benefit cut is not bankruptcy and certainly could not cause America’s bankruptcy.

“Medicare could very well become the option of using my Medicare benefit to buy a private plan that I like better”

The Republican dream of giving seniors a coupon to go out and buy private health insurance is a favorite of Speaker Paul Ryan and those in Congress who hope to destroy Medicare once and for all.  The program is too popular to kill outright, so they’ve chosen a privatization route for Medicare that is a political kissing-cousin to President Bush’s failed effort to privatize Social Security.  If they can’t kill these programs, conservatives want to (at least) turn America’s most successful retirement and health security programs over to industry so Wall Street, insurance companies and drug makers can profit. 


Senator Ted Cruz

“Social Security right now is careening towards insolvency... We need to see political courage to take this on and save and strengthen Social Security.”

In the classic case of “save” meaning “slash” and “strengthen” meaning privatize, Senator Cruz offers the well-worn conservative trope that cutting benefits to millions of American families while at the same time cutting taxes for the wealthy shows political courage and leadership.  See our comments above on the “careening towards insolvency” nonsense.

“We need to change the rate of growth of benefits so it matches inflation instead of exceeding inflation...we need to have for younger workers, that a portion of your tax payments are in personal accounts.” 

If hard to imagine how anyone can seriously argue that a zero cost of living increase for 3 out of the past 7 years, somehow exceeds inflation.  Seniors, veterans and people with disabilities have seen their costs increase in the same years their COLA was flat.  Social Security beneficiaries need a new COLA formula, one that actually measures seniors’ cost of living.  However, Ted Cruz wants the Chained CPI to cut benefits not to accurately measure inflation.


John Kasich

“I also had a plan in 1999 to save Social Security and take the $5 trillion projected surplus and not only have Social Security for our young people, but also to give them private accounts.”

John Kasich’s plan to “save” Social Security is standard GOP “we-must-slash-it-to-save-it” boilerplate with a little seniors just need to "get over it" thrown in.   Kasich would cut benefits to pay down the debt and privatize Social Security so seniors can watch their contributions ride the Wall Street roller coaster.  Then he’d cut billions more with lower COLA’s through the Chained CPI (again, what’s lower than zero?) and turning Social Security into a welfare program by means testing.


Donald Trump

Since we just wrote about Trump’s Social Security promises (there’s not really a plan) in detail we’ll focus only on last night’s twists.  For the first time ever, Trump’s promises to not cut Social Security benefits were offered with important qualifiers.  For a candidate who has no problem making big promises, last night’s about Social Security have taken on a downright passive tone – as if Trump, as President with potentially with a GOP House and Senate, wouldn’t have the power to leave Social Security benefits alone:

“I will do everything within my power not to touch Social Security”

“...it's my absolute intention to leave Social Security the way it is.”

This speech Trump gave to conservatives at the 2013 Conservative Political Action Conference provides one suggestion as to why he remains the only GOP candidate to promise he won’t cut Social Security & Medicare benefits (hint, it’s not because he loves the programs):   

"As Republicans, if you think you are going to change very substantially for the worse Medicare, Medicaid and Social Security in any substantial way, and at the same time you think you are going to win elections, it just really is not going to happen," Mr. Trump said, adding that polls show that tea partyers are among those who don't want their entitlements changed."  Donald Trump, 2013 CPAC speech, Washington Times

If you missed last night’s debate, you can read excerpts on what the candidates had to say specifically about Social Security, Medicare and Medicaid on our SeniorVote2016 website. 

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New Election Website Designed for Seniors Launches Today

As Primary Season Gets Underway, SeniorVote2016

Provides Timely, Comprehensive and Important Resources for Voters

Whose Futures Depend on Social Security & Medicare

The 2016 election for the White House and Congress will be expensive, combative and extremely important for the future of generations of older Americans. Literally millions of American families are impacted by decisions made in Washington on Social Security, Medicare and Medicaid yet these issues remain on the back-burner for many political candidates. To help arm voters with the facts, the National Committee has launched SeniorVote2016.org as a one-stop, easy to use source of information on the 2016 campaign. 

SeniorVote2016’s Candidate Watch provides easy-to-use interactive graphics showing the candidates’ campaign positions and plans for Social Security, Medicare and Medicaid with links to additional interviews and statements about these vital programs.  The Reading Room offers details of current legislative proposals which would impact American’s retirement and health security including questions voters can ask candidates about where they stand on issues such as: turning Medicare into a voucher program, cutting Medicare to fund other programs, raising the Social Security retirement age, cutting benefits through adoption of the Chained CPI and creation of a cost of living adjustment for seniors (CPI-E).  Visitors to SeniorVote2016 can also Take Action directly from the website by pledging to vote and engaging on social media with other Social Security and Medicare activists. 

In addition to the roll out of SeniorVote2016, the National Committee has launched a daily email news digest, providing readers with the latest media coverage on the campaigns and the issues. “Your Morning Read” will have a summary of the important need-to-know stories voters will value as they determine which candidates are most committed to preserving and strengthening America’s most successful programs. 


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