Entitled to Know

43 years ago, President Lyndon Johnson signed Medicare legislation into law not only for the elderly but also for younger generations who care for them. Before Medicare, half of all seniors had no health insurance and nearly 35% lived in poverty. Today senior poverty has dropped by two-thirds and all Americans 65 and older can get health insurance through the Medicare program. Medicare works.

But as Lynda Johnson Robb reminded us at our 25th Anniversary celebration in June, her father knew "Medicare would have to be carefully guarded and improved through the generations".

“The Congressional Medicare veto override and vote to delay arbitrary cuts show Congress has the courage to reconsider these destructive privatization provisions written by and for the drug and insurance industries. Our members hope that with a new Congress and President in the White House we’ll be able to celebrate next year’s anniversary and the end of Medicare privatization at the same time.

This privatization, which was accelerated by the 2003 Medicare Modernization Act, has left seniors saddled with rising premiums, growing out of pocket costs and means testing at a time when they are already feeling the effects of an economic downturn. We must reverse the privatization politics of the past in favor of real policy solutions providing healthcare reform nationwide and strengthening our one universal healthcare plan – Medicare.” Barbara B. Kennelly, President/CEO

It's a provocative thought offered in jest at today’s Kaiser Family Foundation discussion on Health Bloggers and the role they play in policy debates.

For those of you who don’t remember (or would rather forget), Harry and Louise were the stars of the infamous television ad campaign launched by the health insurance industry to torpedo President Clinton’s healthcare reform proposals in 1993.

By most accounts, including this study by Duke University, this ad
campaign helped turn the tide of public opinion...leaving us without healthcare reform for going on 15 years. But as the nation finally appears ready to take another pass at reform, today's Kaiser panelists talked about the role “new media”, specifically blogs, will play in future healthcare debates.

Here’s a sampling of what some of today’s panelists opined:

“The one thing the blogs are very good at is getting the media to notice them. They’re going to be very influential...There will be much more careful conversation because so many partisans are waiting to jump so ferociously on any missteps on either side.” Ezra Klein...The American Prospect

“There will be a much better debate with this many eyes and voices.” Michael Cannon, Cato Institute

“I don’t know if there will be better debate just because there will be more debate.” Tom Rosenstiel, Project for Excellence in Journalism

“It will all happen much, must faster.” John McDonough, Senior Advisor to Senator Edward Kennedy and Former Contributor, A Healthy Blog

As we’ve said here many times, we see nationwide healthcare reform and strengthening Medicare as one in the same. There are clearly lessons to be learned from America’s only universal healthcare plan, lessons we hope policy makers will heed in any future reform debate.

You can also link to video of the full Kaiser session (it runs about 90 minutes).

Congress once again did the right thing and cast a vote for seniors in Medicare by setting aside the Bush administration’s flawed Medicare trigger proposal (required in privatization legislation passed in 2003) and the mandatory cuts it requires. Chairman Pete Stark says the trigger was passed solely “to do a hatchet-job on Medicare”. He’s so right.

The 45 percent threshold at which the “trigger” is set is a completely arbitrary limit included in the Medicare Modernization Act. There has never been a public debate on whether it is appropriate to establish a cap on the federal revenue contribution to the Medicare program at any level, nor has any policy rationale been identified for selecting 45 percent as that federal contribution limit. The fact that more than 45 percent of Medicare financing may come from general revenues poses no more of a problem in itself than the fact that 100 percent of the financing for defense, veterans’ benefits, education or most other federal programs comes from general revenues. The problem facing Medicare is the cost of health care, not how the cost is allocated between revenue sources.

Here’s reaction from our President Barbara Kennelly, after last night’s House vote suspending consideration of the Medicare trigger:

"The National Committee applauds Congress for postponing cuts which would have hurt millions of seniors who depend on Medicare while ignoring the real challenges facing our healthcare system nationwide. The 45% financing cap, mandated in Medicare privatization legislation passed 5 years ago, is arbitrary and meaningless in the larger debate of reigning in the high cost of healthcare. This healthcare crisis is crippling our nation and skyrocketing costs affect not only seniors in Medicare but Americans of all ages. This trigger is nothing more than a distraction from the true challenge facing Medicare: how will our nation provide high-quality health care for an aging population in an era of unchecked health care costs? We congratulate Congress for turning the tide away from arbitrary cuts and cost-shifting to seniors in favor of taking the longer view. Our National Committee members look forward to working with Washington to craft meaningful reform which will serve seniors in Medicare, their children and grandchildren as well."

When should I retire?

Sounds like such a simple question...one asked by millions of seniors each year. Yet the answers are as unique as the individual asking them. To help future retirees sort through it all, the Social Security Administration has unveiled a new benefits calculator.

This isn’t a first for SSA but this latest version goes further than earlier models. The Baltimore Sun’s Eileen Ambrose provides a nice breakdown of how it works:

You won't be able to use it if you don't have enough credits to qualify for benefits - 10 years of earnings - or you are already receiving benefits.

You will need to plug in your Social Security number and mother's maiden name. The agency says the site is secure. And when you print out your information, it won't include these identifying details.

The calculator will ask when you plan to stop working and your average future earnings. It combines these with your earnings history so far.

With the click of the mouse, you can see what your monthly benefit will likely be at 62 - the earliest year to receive benefits - and at other ages. You can,for instance, calculate the difference in benefits by working one more year,something the annual paper estimates don't tell you. In my case, retiring at 63 instead of 62 would mean an extra $100 a month.

Our own senior policy analyst, Mary Jane Yarrington, says the more tools available to workers the better. She answers hundreds of questions from seniors and future retirees each year. Do you have a Social Security question? You can reach her at: “Ask Mary Jane”.

Last week’s Medicare votes gave Congress and the President a simple choice: strengthen the Medicare program for seniors and their physicians or support billions in wasteful subsidies the health insurance industry has lobbied hard to protect. Ultimately, even those who’ve supported the billions of dollars of wasteful subsidies to private Medicare Advantage insurers for years realized this was a very important vote to seniors, doctors and their families.

While the major goal was to block scheduled cut in fees to doctors in Medicare there were many other important provisions, which didn’t get as much attention, yet will affect millions of seniors on Medicare, such as:

• Provides lower out-of-pocket costs for mental health services



• Offers new preventive benefits to Medicare beneficiaries



• Some widely used anti-anxiety and sleep drugs will be added to Part D coverage



• Increases funding for low income beneficiaries and extends the program
  until December, 2009



• Eliminates the Part D enrollment penalty for low income seniors



• Provides incentives to doctors to encourage electronic prescribing




For more details, here’s our summary of The Medicare Improvements For Patients and Providers Act (MIPPA).

Barbara B. Kennelly, President and CEO of the National Committee to Preserve Social Security and Medicare, issued the following statement to NCPSSM members and supporters today:

“Thanks to hard won bi-partisan support in the House and Senate, America’s seniors and their caregivers have averted physician pay cuts that would have severely limited healthcare access to millions receiving Medicare. The National Committee’s members and supporters applaud those in Congress who made the right choice today and voted to put seniors’ healthcare needs before insurance industry profits, by overriding President Bush’s veto. I hope this is just the first vote of many to come, which will reverse the destructive and costly privatization of Medicare, begin a serious bi-partisan debate about nationwide healthcare reform and strengthen the Medicare program for future generations.”

The majority of Congress, including loyal Republicans, America's seniors and their physicians will be told once again where this administration's priorities lie...with the insurance industry. Congressional Quarterly reports this afternoon:

President Bush will veto the recently cleared Medicare bill Tuesday, a senior administration official said Monday on a conference call arranged by the White House. The administration is unhappy with the Republican senators who voted for the bill July 9, but appears to hold out little hope of being able to sustain the veto, or flip back GOP senators who deserted the president on the controversial measure. “If everyone votes as they did, we would not be able to sustain this veto,” said Tevi Troy, deputy secretary of the Department of Health and Human Services. Speaking of the likely override, Troy said, “That is a real problem, but it’s not the Democrats who put us in that position. It’s the nine Republicans” who changed their votes in support of the bill.

Both chambers have more than enough votes to override the president, assuming no members change their votes. In the case of a veto override, the House would vote first. A House vote on overriding the president’s veto could occur as early as Tuesday, with the Senate acting rapidly afterwards.

You know it’s bad when even the “clarification” gets it wrong. Senator McCain’s explanation of his ‘Social Security is a disgrace’ comment shows he either doesn’t understand the system’s long-term financial picture or he’s just picking up where the President’s privatization campaign left off. Here is his clarification from The Trail:

Hard to imagine, right? Even the most hard-core, anti-Social Security flame throwers in town generally use less inflammatory (and fundamentally flawed) language to describe America’s most popular government program. Why then would Senator McCain go there? Good question.

Now, you might be thinking “he probably didn’t mean what he said...or it was just a slip of the tongue” (honestly, that was our first thought too). However, when a politician delivers basically the same message twice in 24 hours the “he didn’t mean it” theory just doesn’t work. Specifically, here is what Senator McCain has said about Social Security in the past two days, first at his Denver Economic Town Hall on Monday:

“Americans have got to understand that we are paying present-day retirees with the taxes paid by young workers in America today. And that's a disgrace. It's an absolute disgrace, and it's got to be fixed.” John McCain, Denver Economic Town Hall, July 7, 2008

“On the privatization of accounts, which you just mentioned, I would like to respond to that. I want young workers to be able to, if they choose, to take part of their own money which is their taxes and put it in an account which has their name on it. Now, that's a voluntary thing, it's for younger people, it would not affect any present-day retirees or the system as necessary. So let's describe it for what it is. They pay their taxes and right now their taxes are going to pay the retirement of present-day retirees. That's why it's broken, that's why we can fix it." John McCain, CNN American Morning, July 8, 2008

Sounds like an easy choice, right? Apparently, not for Republican Senators who voted against the Medicare bill last month. By all accounts, that Medicare vote, which preserved billions in insurance industry subsidies while requiring cuts in doctors’ payments, made for a tough July 4th recess for some Senators. You can certainly see why... casting a vote to protect billions in industry overpayments while cutting pay for doctors in Medicare has to be a tough sell to seniors, their families, and the doctors serving them. Especially as they're all feeling the pinch of this current economy.

The bill will come up again this week and National Committee members have added their voices to the debate by urging the Senate to cast the right vote this time around. We’re launching an internet ad campaign and have emailed our new :30 Medicare spot to our members urging them to contact their Senators before the mid-week vote:

As Finance Committee Chairman, Senator Max Baucus told reporters today:

Find out how your Senators voted and then use our Legislative Hotline at (800) 998-0180 to connect to them directly with one toll-free call. Ask them to support HR 6331-the Medicare mprovements for Patients and Providers Act of 2008.

Barbara B. Kennelly, President and CEO of the National Committee to Preserve Social Security and Medicare, issued the following message to NCPSSM members and supporters today:

“Once again we’ve seen the profits of the insurance industry take precedence over a call for help from America’s seniors and their doctors. The Administration’s allies in the Senate last night rejected HR 6331, a bill that would have preserved Medicare beneficiaries’ access to their doctors by averting a physician fee cut. Instead of approving important beneficiary improvements for the more than 44 million seniors and people with disabilities served by Medicare, a minority in the Senate once again blocked action on legislation that would have begun to reduce the overpayment of billions of tax payer dollars to Medicare Advantage insurers.

H.R. 6331 would have improved access to prevention and mental health services for all beneficiaries, and decreased the cost-sharing burden for low-income seniors who often forgo services because of expense. In addition, the bill would have preserved access to needed physical, occupational and speech-language therapy and prohibit many of the abusive marketing practices used to enroll beneficiaries in private Medicare Advantage plans and Part D prescription drug plans.

The momentum of the on-going privatization of Medicare continues to worsen the economic and healthcare outlook for the elderly. How ironic as the Presidential candidates discuss improvements to our nation’s healthcare system, the Congress continues to weaken our one universal healthcare plan – Medicare.”

So whatever happened to the Straight Talk Express?

Watching John McCain parse words over Social Security private accounts during the past few months has left more than few people bewildered. Last week’s pronouncement that he is...

‘not for, quote, privatizing Social Security. I never have been, I never will be’

But wait a minute, just 3 months ago conservatives were relieved to see Senator McCain promise the Wall Street Journal he still supports President Bush’s failed privatization plan, in spite of what his campaign website said at the time.

While the American people overwhelmingly rejected President Bush’s plan to turn Social Security over to Wall Street, the privatization campaign did succeed in one way...most people now understand what private accounts and the privatization of Social Security really means. Senator McCain’s attempts now to redefine what privatization is in order to hide his past and present support for a failed and wholly unpopular strategy tells seniors and their families a lot about John McCain’s priorities.

They will, no doubt, have a lot to say in return come November.

The Youth Entitlement Summit wraps up in Washington today and our President, Barbara B. Kennelly, addressed the group this morning. Given the clear anti-entitlement bent of the summit’s sponsors such as the Concord Coalition and the Peterson Foundation, some early supporters, like Rock-the-Vote, ultimately withdrew their summit sponsorship. Future Majority blogged about it here.

Barbara was in fact a very lonely anti-privatization voice in the room today. Even so, as a bi-partisan membership organization we felt strongly the National Committee’s message needed to be heard.

We urge you to read Barbara’s entire speech for more details on the fiscal realities facing our children and grandchildren. It’s clear that groups like those sponsoring this summit understand they have to continue to undermine younger generations’ confidence in Social Security in order to convince them to give it up or destroy it through privatization.

We’ve also taken our “Don’t Buy the Lie” campaign to our YouTube Channel and MySpace page in an effort to reach this demographic with the truth about Social Security and Medicare.

Who is the National Committee anyway and why should you care?

We've produced a new video detailing our organization's 25 year history, the history of the Social Security and Medicare programs and the vital role they play in the lives of American Seniors.

This is only the second video we've produced since buying basic video & editing equipment. Our first was a youth video created to take our message to younger generations via our new YouTube channel and MySpace page. It's certainly been a learning experience but we hope to produce many more over the coming months to help spread the word that together we can preserve Social Security and Medicare. After all, it's all about priorities.

In these days of seemingly never-ending sky-is-falling entitlement rhetoric, today’s National Committee 25th Anniversary celebration offered a much-needed reminder of the critical roles Social Security and Medicare play in the lives of millions of Americans. Our 25th Anniversary celebration today was very much a “family” affair.

James Roosevelt, Jr., grandson of President Franklin Roosevelt and son of the National Committee’s founder, James Roosevelt reminded the several hundred advocates, policy experts, and leaders from the aging community assembled today, why it’s so important to continue fighting to preserve Social Security for future generations:

“My father believed as I do that Social Security was an essential part of maintaining the dignity of Americans throughout their lives. I’m pleased to say that, in spite of those who continue to misinform and advocate privatization (and they haven’t gone away), the dedicated Social Security funding mechanism and the dedicated delivery system has been very successful in raising the vast majority of our elderly citizens out of poverty. I’d even suggest the National Committee is even more needed today than when it was created 25 years ago.”

My how time flies when you’re fighting the good fight.


The National Committee is celebrating its anniversary today at a National Press Club ceremony. A few hundred of our closest friends and allies will join us as we mark a quarter of a century devoted to the singular and unique mission of preserving America’s two most successful social insurance programs.

We’re so pleased to have many special guests attending today including, Congressman John Dingell (D-MI) Chairman of the House Committee on Energy and Commerce, Lynda Johnson Robb, daughter of President Lyndon B. Johnson and James Roosevelt, Jr., son of NCPSSM’s founder James Roosevelt, Sr. and grandson of President Franklin Roosevelt.

The National Committee will also present the 2008 Media Excellence Awards to Saul Friedman from Newsday whose column Gray Matters covers the political, economic, and social issues affecting older Americans, and Ronni Bennett, one of the first bloggers to engage in an in-depth conversation on elder issues with her thought-provoking and entertaining blog “Time Goes By”.

Our President/CEO, Barbara Kennelly gave us a sneak-peak of some of her remarks today:

Some might ask, "Why join an organization like the National Committee when you can just write or call Congress yourself?" Well -- the answer is simple...there is power in numbers. We know -- first hand -- the power of millions of voices versus one voice. That’s why time after time, issue after issue, our National Committee members have been united in the fight for what they believe. We believe in the social insurance mission of Social Security and Medicare, which is why we strongly oppose privatization.

As FDR himself once said…"Repetition does not transform a lie into a truth". That statement is as true today as it was when Social Security was created 73 years ago. Just because those who are fundamentally opposed to Social Security continue to say it’s a failed program, doesn’t mean it’s true. So, while we have had past successes in the battle over private accounts...the war over the long-term future of Social Security and Medicare continues. The same groups that want to turn Social Security over to Wall Street and Medicare over to private insurers, have been building the case that America "can’t afford" these programs...all under the guise of"entitlement reform". They’ve targeted young people in a cynical divide-and-conquer strategy to pit the young versus the old. Ultimately the hope is that our children and grandchildren will just give up on Social Security and Medicare because they’re been told these programs won’t be there for them anyway. Well, guess what? The National Committee won’t let that happen and we know neither will any of you.

Once again the Bush administration is threatening to veto legislation which would prevent June’s scheduled pay cuts to doctors in Medicare because Congress wants to pay for it by trimming some of the billions of dollars in industry subsidies going to private insurers. Let’s see...doctor’s pay cuts or industry subsidies?

For many it’s seems obvious that supporting providers should take priority over government giveaways to an industry already seeing record profits thanks to the privatization of Medicare; however, for the Bush administration the priority continues to be to protect this industry slush fund above all else.

Congress Now quotes our Government Relations and Policy Director, Maria Freese:

“Democrats need to get 60 votes in the Senate to avoid a filibuster,but without the support of Republicans like Grassley and Sen. Orrin Hatch (R-Utah), who both oppose MA cuts, it will be difficult for them to be able to meet this threshold, Maria Freese, director of government relations and policy for the National Committee to Preserve Social Security and Medicare, said.”They're going to be lucky" to get 60 votes, she said.”

So, once again Congress appears ready to protect these outrageous industry overpayments ($150 billion over ten years) even though they shave almost two years from Medicare’s solvency, and force all beneficiaries (not just those enrolled in MA plans) to pay $36 per year in higher premiums. Even MedPac continues to recommend their repeal.

Oh yes, don’t forget why Congress is even debating this issue now. Doctors serving Medicare patients will also face payment cuts in less than a month in order to protect this giveaway to insurers.

The May 21st New York Times’ editorial on Medicare Advantage Marketing Abuses is our selection for this month’s “Networthy Award” for outstanding coverage of elder issues on the net.

Entitled “Medicare’s Much-Too-HardSell” this piece narrows in on the unavoidable truth behind the inexcusable fraud and predatory marketing practices too often used to sell private Medicare Advantage plans. The Times writes:

“The Bush administration has proposed welcome new regulations to curb the deceptive, hard-sell tactics often used to foist private Medicare policies on unwary consumers. Unfortunately, it has been unwilling to eliminate the root cause of the problem: the high subsidies that prop up these plans and make them so attractive to high-pressure marketers.”

Also:

“The worst abuses have been committed by predatory marketers selling the comprehensive policies known as Medicare Advantage plans. The government pays these plans 13 percent more, on average, than the same services would cost in the traditional Medicare program. The subsidies are even more egregious — averaging 17 percent above cost — for the so-called private fee-for-service plans within Medicare Advantage. All told, the unjustified subsidies will cost the government more than $50billion from 2009 to 2012. Small wonder that plans use high-pressure tactics to market these lucrative policies.”

Our President/CEO, Barbara Kennelly, commended the Times on its dead-on assessment in this letter to the editor:

“Rather than spending even more federal dollars policing private insurers in Medicare, why not remove the underlying incentive encouraging them to push these higher profit plans in the first place? How many dollars will we spend on investigations and enforcement for private insurers who want to maximize the financial incentives provided to them by Congress?”

One of the most frequently used arguments used to promote private accounts is the promise that “you can do better” by investing your Social Security money yourself.

Problem is...for too many people, that’s just not true. A new analysis of nearly 1 million retirement portfolios show the majority of savers are making costly errors in their 401(k)s. The Associated Press reports:

"...69 percent have inappropriate risk or diversification of holdings and 36 percent have worrisome concentrations of company stock. In addition, one-third of savers aren't putting enough aside to qualify for the full company matching contribution. The problems are especially pronounced among young and low-paid workers... When looking at risk and diversification of investments, 38 percent of the portfolios had very inefficient or very inappropriate investments. That could range from a young participant with a portfolio that's too conservative to an older worker with one that's too aggressive. An additional 31 percent had somewhat inefficient or risk-inappropriate holdings. The remaining 32 percent had good balance in their portfolios.”

"Unfortunately, our study found that those who need their 401(k) the most look to be benefiting the least."

by Barbara B. Kennelly, NCPSSM President/CEO

I was on the Hill today testifying before the House Ways and Means Subcommittee on Social Security. At issue is legislation that requires the Social Security Administration to administer a national employment verification system. The National Committee has not taken a position on the underlying goals of any of the immigration bills before Congress. However, this employee verification issue demands our response.

I cannot say strongly enough what a serious disservice would be done to America’s seniors and others if Social Security was required to carry the burden of this enormous, costly and unrelated immigration workload. According to the Congressional Budget Office, the cost to SSA of one of the leading immigration proposals would be more than $1 billion in just the first year of implementation...an amount equal to nearly 10 percent of the agency’s administrative budget. Experts have concluded that the E-Verify process, with its millions of notifications about mismatches of employee information...would result in a deluge of phone calls and visits to Social Security field offices around the country, swamping other crucial SSA activities.

The Social Security Administration is already facing significant challenges, primarily because of years of insufficient funding which isn’t keeping up with the increasing workloads. Chief among these challenges is a disability claims crisis. Disability cases are piling up and needy people are waiting years to receive their benefits. At the same time, SSA is facing the retirement of 80 million Baby Boomers who will also be expecting swift and accurate processing of their retirement claims.

Historically, the Social Security Administration has the government’s best reputation of solid service to its beneficiaries. However, the strains of recent years have taken their toll. I say enough is enough.

Here are some important links on this issue: CBO and GAO Reports on verification legislation, our National Committee Viewpoint on SSA funding, and my full Congressional testimony.

Health and Human Services Secretary Michael Leavitt continues the entitlement crisis call, this time in an address to conservative think-tankers who’d rather see Social Security and Medicare just go away entirely. While using language like “drifting toward disaster” and “serious danger” to describe the program he’s overseen for almost 8 years, he conveniently ignores the role the Bush Administration has played in worsening Medicare’s financial condition.

It’s very hard to take these clarion calls very seriously when it was this administration that implemented and continues to fight to protect $150 billion in industry subsidies to insurance companies providing private Medicare coverage. These subsidies alone steal almost two years of solvency from the Medicare program. If Secretary Leavitt and the Bush administration are really worried about Medicare’s solvency...how about putting that $150 billion back into Medicare rather than private insurers’ pockets?

Secretary Leavitt also expressed concerns there could be a generational divide on funding entitlement programs:

“The kind of division I worry about is when we begin to see one generation pitted against another or when you begin to see economic classes pitted against each other. Those are the kinds of divisions that have classically divided and undermined nations.”

For baby-boomers who’ve been watching their retirement investment income lose money week by week, the fact that Social Security remains stable and predictable while Wall Street is anything but is critically important. Former Labor Secretary Robert Reich calls the failure to privatize Social Security “the best thing that didn’t happen during the Bush administration”:

“... had we privatized, they’d (retirees) be totally reliant on the stock market. And look what’s happened to the market: Compared to stock values ten years ago, the S&P 500 has risen a little over 1 percent a year, adjusted for inflation. Even Treasury bonds have done better. Go back nine years and there’s been no gain at all. Go back eight years and the market has been off an average of 1.4 percent a year.”

This isn’t a unique analysis. Even a member of President Bush’s own Social Security Commission and a private accounts supporter, co-authored an analysis for the National Bureau of Economic Research which showed promises of higher returns with private accounts just didn’t hold up to scrutiny:

Social Security is an insurance program, not an investment vehicle. Social Security is not supposed to make you rich, it is supposed to prevent you from slipping into poverty. Social Security is the one insurance program that provides some measure of economic support for Americans if a family wage earner dies or becomes disabled. Privatizing Social Security turns a safety net for everyone into a golden parachute for a few.

There are a number of Social Security items of note today...first this Wall Street Journal article regarding “payday lenders” and continuing attempts to take advantage of seniors who receive direct deposit payments from Social Security each month. The WSJ reports:

“Social Security recipients with direct deposit can effectively use future benefits as collateral for short-term, high-interest loans. Some lenders require borrowers to have their Social Security checks deposited directly into banks that partner with the lenders. Typically, the banks are in other states and provide no checks or ATM cards to the borrowers. Thus, borrowers can get their monthly Social Security benefits only by visiting the lenders to pick up what remains after loan payments, interest and fees are deducted. Some lenders 'attempt to exercise too much control' over payments sent to beneficiaries and
then automatically transferred to the lenders, Social Security said”.

You can expect lenders to fight any changes. So far, SSA has only asked for public comment in a Federal Register notice and the agency says it has not decided what changes to make.

It’s Not Too Late

A reminder to seniors...it’s not too late to file for a stimulus check. Even though the IRS April 15th tax deadline has come and gone you have until the end of the year to file for a stimulus check. The IRS Stimulus Information Center advises Social Security recipients:

You can also download the 1040A form, all of the details you need to file a stimulus request from the IRS and free software to process an online filing here.

While much has been written about this year’s Social Security and Medicare Trustees Report (we’ve already highlighted some of the coverage here ) there is another piece of recommended reading. This commentary highlights a constantly overlooked aspect of the “entitlement” debate...the fact that regardless of the “sky-is-falling” certainty expressed by those opposed to Social Social Security, the Trustees’ actuaries know solvency and the economic issues underlying the 2017/2041 dates are moving targets, especially in a 75-year or infinite window. Marketwatch economist Dr. Irwin Kellner writes:

Does that mean we should ignore the Trustees’ annual projections? Of course not. But that really is the point here...these are estimates and projections that should be used in a responsible way to ensure the long-term solvency of Social Security, which millions of Americans and their families depend on.

Medicare’s chief actuary testified in the House today following last week’s release of the Social Security and Medicare Trustees Report. Ways and Means Health Subcommittee Chairman Pete Stark highlighted some of the back-and-forth in a News Release issued at the conclusion of today’s event:

“When Secretary Leavitt appeared before the Subcommittee earlier this year, he made alarmist statements about the future of Medicare and told us to ‘call the government actuary’. Well, we did,” stated Chairman Stark, “and the Medicare Chief Actuary made it clear time and time again today that overpayments to private plans are a serious drain on Medicare’s financing that undermine the program’s financial health and raise costs for all beneficiaries. I think Secretary Leavitt is the one who needs to talk to his actuary.”

In today’s Ways and Means Health Subcommittee hearing on the 2008 Medicare Trustees report, Centers for Medicare & Medicaid Services Chief Actuary Rick Foster made several important statements.

** Foster said that overpayments to private Medicare Advantage (MA) plans shorten the solvency of the Part A Trust Fund:

“If the law were changed such that benchmarks were set at fee-for-service rates, then it would extend the solvency of the Medicare Trust Fund by about 18 months.”

** He also indicated that overpayments increase premiums for all 44 million seniors and people with disabilities – even though almost 80 percent of Medicare beneficiaries are not enrolled in private plans:

“As of 2009, the additional premium associated with higher [MA] benchmarks is about $3 a month.”

** When directly asked if Medicare advantage ever costs less than fee-for-service, Foster flatly said:

“No, not under current law.”

** Foster also stated that hitting the “45 percent trigger” does not mean there is a crisis with the Medicare Trust Funds:

“Despite the title, the Medicare Funding Warning should not be interpreted as a finding that Medicare funding is inadequate.”

**When asked about the arbitrary nature of the nature of the trigger, he stated:

“I’m not aware of any specific technical rationale for it.”

** Foster confirmed that the 2008 Trustees report would not have triggered the “Medicare Finance Warning” had payment rates between traditional fee-for-service Medicare and Medicare Advantage plans been equalized:

“If [benchmarks were set at fee-for-service rates] as in the CHAMP Act, the trigger would not have been tripped in this report. General revenues would not have crossed the 45% threshold until 2016 rather than 2014.”

** When discussing the financial future of Medicare, it is important to remember that health projections are notoriously unreliable. For example, small changes in assumptions or experience with respect to productivity, utilization and other variables, can produce substantially different estimates. In discussing this volatility, the Chief Actuary warned against putting too much stock in long-term estimates:

“We should never kid ourselves or place too much reliance on what are inherently uncertain projections.”


Our Analysis of the 2008 Trustees Report can be found here and more details on Medicare Advantage Plans and the outrageous industry subsidies they depend on is linked here.

Just when you think conservatives might have run out of new ways to destroy Social Security, columnist Robert Novak joins the discussion today urging Presidential candidate John McCain to cut the payroll tax. How ironic that just two days after all the political posturing by the administration and conservatives on the Hill about the need to reform entitlements to “save” Social Security, Novak now reports that one McCain advisor says it’s “not a big deal” to cut the very revenue needed to fund benefits for millions of retirees.

Senator McCain has already supported taking money out of Social Security to fund private accounts, which endanger the program enough, now conservatives want even more...to starve Social Security until it finally succumbs. Novak says: “

Cutting the payroll tax, which funds Social Security, would not be easy but would offer a rich economic prize in this lean Republican year.”

Really? A rich economic prize for whom? Certainly not the 34 million retirees and their families who need Social Security and will see the program starved in this never-ending quest for fiscally irresponsible tax cuts.

Social Security is fully funded for 33 years and Medicare is solvent for another decade. But don't be surprised if those details are buried in any coverage you might read about this year's Trustees Report. It just doesn't fit with this administration's "entitlement crisis" calls.

This year’s trustees report confirmed what we already know about the health of Social Security and Medicare...Social Security will continue to have a surplus for more than three decades while a nationwide healthcare crisis continues to escalate costs for seniors in Medicare. Here’s reaction from our President/CEO Barbara Kennelly:

“This trustees report shows that Social Security is on track to pay full benefits for more than 3 decades. But the challenges of skyrocketing healthcare costs are threatening not just seniors in Medicare but Americans nationwide. No doubt, this annual report will have the sky-is-falling crowd calling for ‘entitlement reform’ again while they continue to ignore America’s healthcare crisis and fight to protect billions in insurance industry subsidies which steal years of solvency from the Medicare program”

Social Security isn’t bankrupt. Unfortunately, too many in our national media just don’t seem to understand that basic truth.

We’ve written about this before so won’t rehash it again (not too much, anyway). But the latest oversimplified, sky-is-falling and propaganda-laden coverage from Debra Saunders in the San Francisco Chronicle just can’t be ignored. And we’re not the only ones who think so. End of the Echo blog has a nice response and so did our President, Barbara Kennelly. Here is her Letter to the Chronicle, since you probably won’t ever see it published.

Dear Editor,

If Debra Saunders really wants to have an honest discussion about our nation’s current fiscal mess (Everyman’s Mortgage Crisis, 3/11/08), let’s start with the facts. Comments like “Washington has promised benefits...without funding them” and “Washington continues to authorize...benefits without putting aside money for them” are certainly provocative but the problem is those statements just aren’t true. American workers (not Washington) have contributed $2 trillion dollars to the Social Security trust fund in the past two decades leading to a $187 billion surplus. Those contributions will continue to build the surplus to $4.2 trillion over the next decade.

Washington does face a crisis; however, it’s a budget crisis not an entitlement crisis. President Bush inherited a budget surplus and a Social Security trust fund built-up in preparation for baby boomers’ retirements. Now, after billions of dollars in tax cuts, an underfunded war in Iraq and six years of a Republican-led Congress following the President’s “borrow and spend” lead, we face record debt and budget deficits. These deficits are now being used as the primary argument for cutting programs like Social Security and Medicare, while tax cuts for the wealthy continue and billions in subsidies to the drug and insurance industry are protected.

Washington will have to make difficult choices to repair the fiscal damage done by this administration. But serious health care reform and strengthening Social Security for the long term should be the priorities rather than destroying the very programs so critically needed by millions of Americans.

Sincerely,

Barbara B. Kennelly, former Member of Congress
President and CEO of the National Committee to Preserve Social Security and Medicare

Mark Weisbrot is co-director of the Center for Economic and Policy Research and he’s also written a wonderful piece on Media accountability, false information and its affect on political progress.

That appears to be the continuing strategy for Senator Jim DeMint and other congressional privatizers intent on passing Social Security private accounts, whether the American people support them or not. You have to wonder, if privatization is such a great idea why do supporters go to such lengths to hide their true goals?

The latest privatization ploy comes under the guise of "stopping the raid" on the Social Security trust fund. Senator DeMint says he’ll "force a vote" on his amendment creating a "reserve fund" in Social Security. What he doesn’t mention in his news release is that this newly created "reserve fund", actually just diverts money from the existing Social Security trust fund to a new fund to create private accounts. Senator Demint's amendment is really just a privatization sleight of hand. Rather than "stopping the raid" as promised, this legislation allows the trust fund to be raided for a different purpose...the creation of private accounts.

The truth is the DeMint amendment is just a rework of the failed Bush privatization plan. It would divert money out of Social Security to fund private accounts, increasing federal outlays and requiring significant cuts in Social Security’s guaranteed benefits to foot the bill. All of this, so that future retirees can take their stable Social Security benefits on a risky Wall Street roller coaster ride.

Our letter to Congress has more details about what this amendment really includes and our analysis on the same amendment when it was introduced three years ago is linked here.

Congress provided even more evidence of just how flawed the 2003 Medicare Modernization Act is this week when the leadership was legally required to introduce legislation, which experts agree, is doomed to fail.

As we’ve reported here before, there’s no economic or budgetary reason for the arbitrary 45% trigger provision, which will require massive budget cuts in Medicare. This trigger really is nothing more than a political device designed to convince Americans we “can’t afford” Medicare while also distracting attention away from the real crises; our national debt and skyrocketing healthcare costs. Kaiser has provided a good roundup of news coverage on this trigger legislation.

On Monday, House Majority leader Steny Hoyer, as required by law, introduced the trigger legislation, in spite of its certain death in Congress. He told Congress Daily, lawmakers can’t ignore the growth in Medicare and Medicaid costs but:

"Unfortunately, the Medicare trigger is ill-suited to such a process”, he said. "I am very skeptical that we can deal with the issue of entitlements in a bipartisan manner in the current environment, especially since the current administration has made it clear that it is not willing to discuss all options."

Let’s review those options not up for discussion. The administration still refuses to consider allowing Medicare to to negotiate for lower drug prices as the VA currently does. Why? It will cut into drug makers’ profits. But that provision could save Medicare an estimated $600 billion dollars over 7 years. The administration also refuses to consider eliminating the $149 billion dollar subsidies provided to private insurers offering Medicare Advantage plans. Why? It would cut into insurers’ profits. But that provision could save almost $150 billion dollars and add two years of solvency for Medicare.

See the common theme here? Triggers and cuts that hurt seniors and the programs that protect them in order to preserve profits and new privatized markets that help industry prosper.

Is it any wonder then that seniors are anxious to pull their own trigger come November?

For years now, we’ve been encouraged to worship at the altar of “ownership”. Whether it’s sub-prime mortgages we can’t afford or risky Social Security private accounts riding the Wall Street roller coaster, Americans have been promised great things from an “ownership” society. As Providence Journal’s Froma Harrop wrote in a column this week:

How interesting that the buildup to the mortgage meltdown employed many of the same sales tactics as the Social Security privatization scheme. Resentment, fear, flattery and hype — plus scant details on fees and other costs — all went into the pitch.

And that’s really the point, isn’t it? Social Security is reliable and guaranteed. It’s not supposed to make us rich; it’s designed to prevent us or our families from slipping into poverty during old age, disability or premature death.

Boring? Maybe. But it’s certainly better than the privatization myth peddled to American taxpayers by an administration determined to dismantle Social Security.

So now what? The Internal Revenue Service will deliver rebate checks to those who qualify, starting in May. For the vast majority of Americans, they just need to file their usual 2007 tax return. But it could be a little trickier for some Social Security recipients and disabled veterans who wouldn’t normally file a tax return. They’ll need to file this year, even if they don’t owe any tax, to ensure they hit IRS’s radar. According to the IRS:

The IRS and Treasury will be working closely with the Department of Veterans Affairs and Social Security Administration along with beneficiary organizations to ensure that all eligible individuals know what to do to receive a stimulus payment.

The stimulus legislation also provided $31 million in addition funding to the Social Security Administration to provide staff and training to help seniors navigate the stimulus process.

The CCH group is a tax analysis firm which has provided a detailed description of the stimulus rebate and how the checks will be calculated. The Treasury Department also has a Fact Sheet describing the distribution formulas.

Unfortunately, scammers have already found a way to try and take advantage of seniors through a phone and email scam using the rebate at bait. The IRS never sends unsolicited emails and isn’t offering check “advances” so the IRS warns seniors to beware.

by Barbara B. Kennelly, NCPSSM President/CEO

Many a cynic said it couldn’t be done. But last night the House and Senate compromised on an economic stimulus package that improved with time. Thanks to the foresight and hard-fought efforts of Senate Finance Committee Chairman Max Baucus, Senator John Kerry and others who took up the cause, more than 20 million seniors who otherwise would have been excluded will now receive stimulus checks.

When the talk of an economic stimulus plan first began, it was clear that once again seniors would be ignored in any Washington efforts to jump-start the economy. The same had happened in 2001 and 2003, so this administration’s blind spot to seniors really wasn’t a surprise.

But this year was clearly different. American seniors are sick and tired of policies that have left them with dwindling COLA’s, skyrocketing healthcare costs and massive budget cuts in programs they desperately need. They’re feeling the pinch of this economy as much as anyone so the suggestion that a retired person living on $3,000 of Social Security doesn’t need or deserve an economic boost as much as someone earning $70,000 was the proverbial last straw.

Congress heard from America’s retirees on this one because the fundamental unfairness of ignoring more than 20 million seniors in a stimulus plan, which was supposed to be “timely, targeted, and temporary”, could not be ignored. National Committee members visited, emailed and called their Congressional representatives. In all, there were more than 3,000 contacts to Capitol Hill made by NCPSSM members and supporters in a just a couple of weeks.

Grassroots efforts still work. Individual voices raised together can get Washington’s attention. Something we should all remember during this election year...you can be sure your members of Congress do.