Tag Archives for Alliance for Retired Americans

Social Security 2025 COLA expected to be small increase 

Published in RINewsToday on September 16, 2024

Stay tuned… Next year’s cost-of-living adjustment (COLA) will be announced by the Social Security Administration (SSA) in mid-October, upon the release of September’s annual inflation adjustment data.  SSA’s COLA for 2025 will be reflected in beneficiary checks starting in January of that year. Like clockwork, this happens annually, although beneficiaries may see their payments occasionally arrive a few days early due to holidays or weekends. 

The Senior Citizen’s League (TSCL) releases its COLA projections each month. The official COLA is determined by the Labor Bureau’s revised CPI-W data from July, August and September.

Some say SSA’s 2025 COLA is “Chump Change”

With one month left, TSCL’s latest COLA model results, released on Sept. 11, 2024, predicts that next year’s COLA will be 2.5 % based on a decline from 2.9% to 2.5% in consumer price data. While 2.5% is lower than the 3.2% received in 2024, that wouldn’t be far from the historical norm. The COLA has averaged about 2.6% over the past 20 years. It went as low as 0.0% in 2010, 2011, and 2016 and as high as 8.7% in 2023.

According to TSCL, by law, the annual inflation adjustment is based on the average inflation during July, August, and September as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The Bureau of Labor Statistics averages the CPI-W for these three months and then compares it with the same timeframe from the previous year, says the Alexandria-based nonprofit advocacy group whose mission is to protect Social Security, Medicare, and veteran or military retiree benefits.  

TSCL’s COLA latest analysis findings indicates that next year’s COLA of 2.5% would raise the average monthly benefit for retired workers of $1,920 by $48 or about $564 annually. The modest increase will not enable seniors to cover increasing cost of living expenses (including food, clothing, transportation, energy, and shelter costs).  “Rising grocery prices is creating food insecurity for many retirees. Feeding America estimated that 5.5 million Americans age 60 and above suffered from food insecurity in 2021, in the most recent study available on the subject, and that number is likely higher today,” note the researchers.

“Due to a higher cost of living, older Americans are using more and more of their income each month just to get by compared to a year ago. “Sixty-five percent of seniors reported monthly expenses of at least $2,000, up from 55% in 2023,” says TSCL’s COLA analysis, noting that statistical testing shows that there’s almost no chance that this gap is due to noisy survey variation. (The 2024 survey had 2,129 respondents; 2023 had 2,258 respondents.)

But low-income seniors aren’t the only ones who have seen their expenses rise, either, say the researchers, noting that more seniors are spending at least $4,000 or $6,000 per month compared to 2023, too, while fewer are able to get by on $1,000 or less. TSCL says that a rise in monthly expenses wouldn’t be much of an issue if seniors’ higher expenses were going to fun activities things, like activities with their grandchildren, or discretionary costs, like bucket-list vacations. However, this is not the case, says the Social Security advocacy group.  “Nearly 80% of senior households in the 2024 survey reported that their monthly budget for essential items like food, housing, and prescription drugs had increased over the last 12 months, with 63% saying they’re worried that their income won’t be enough to cover these basic costs in the coming months,” says the analysis findings.

Over the years, TSCL, along with other aging advocacy groups including the National Committee to Protect Social Security (NCPSSM) and Social Security Works, have called for higher COLAs.

Calls for Congress to change current COLA formula.

Last March, in correspondence to Sen. Bob Casey, Jr. (D-PA), chairman of the U.S. Senate Special Committee on Aging, NCPSSM, the Washington DC based Social Security advocacy group endorsed Casey’s legislative proposal, S. 3974, entitled the “Boosting Benefits and COLAs for Seniors Act.”  The proposal has been referred to the Senate Finance Committee.

Specifically, Casey’s legislative proposal, introduced March 19, 2024, would direct SSA to adjust benefits based on CPI-E rather than CPI-W, if CPI-E would result in a larger increase in benefits. The Bureau of Labor Statistics  (BLS) would calculate and publish the CPI-E on a monthly basis. The Senator believes it would be the most accurate measure of the real effect of inflation on the goods and services that are purchased by America’s seniors.

In NCPSSM’s correspondence, CEO and President Max Richtman strongly supported Casey’s call for requiring BLS to change the way it calculates SSA’s annual COLAs, using a CPI-E formula.

According to Richtman, SSA’s current formula for calculating COLAs is based upon the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which is a measurement by the BLS of the changes in the prices paid for a market basket of goods and services purchased by urban wage earners and clerical workers.

“The current CPI-W has fallen far short of providing needed inflation protection because it fails to adequately measure the spending patterns of seniors,” says Richtman in his endorsement of Seniors typically spend more on out-of-pocket health care costs than other Americans, and in most years, the cost of health care rises more quickly than general inflation,” he says. “We believe adoption of your bill would go a long way toward protecting those on fixed incomes from the ravages of inflation,” says Richtman.

The following organizations have endorsed S. 3974: Arc of the United States; Alliance for Retired Americans; American Federation of Government Employees; American Federation of State, County and Municipal Employees; California Alliance for Retired Americans; Justice in Aging; National Committee to Preserve Social Security and Medicare; National Education Association; National Organization of Social Security Claimants Representatives; Social Security Works; Strengthen Social Security Coalition.

While former President Donald Trump and Vice-President Kamala Harris have both pledged to protect Social Security, nether have put out a specific plan to keep America’s retirement program solvent.

According to the last Social Security Trustees report, the Social Security Old-Age and Survivors Insurance  trust fund is projected to be depleted by 2033 at which point SSA will be forced to make a 21 percent across the board reduction.  The nonpartisan Committee for a Responsible Federal Budget estimates that this would be a $16, 500 cut in annual benefits for a typical dual-income couple retiring at the time of trust fund depletion. 

When the dust settles after the upcoming presidential election, the new president must make it a priority to hammer out a bipartisan fix along with pushing for requiring BLS to use the CPI-E Formula to accurately predict the impact of inflation on America’s retirees. 

Medicare Drug Price Negotiation Program to save billions. Cut costs for 10 drugs, 2026

Published in RINewsToday on August 19, 2024

On Aug. 16, 2022, President Joe Biden signed into law the Inflation Reduction Act of 2022 (IRA), which aimed to reduce the federal budget deficit, invested in domestic energy production while promoting the use of clean energy.  The historic federal law (Public Law 117-169) also lowered the health cost for millions of older Americans by lowering the high cost of prescription drugs by granting Medicare the power to directly negotiate drug prices with drug companies 

 IRA also created the first ever annual cap on out-of-pocket drug costs for Medicare beneficiaries,  capping the cost of each covered insulin at $ 35 per month, and the law also made the Affordable Care Act market plans more affordable.

On Aug. 15, 2024, just one day before IRA’s 2nd Anniversary, Biden and Vice President Kamala Harris unveiled the new lower prices for 10 drugs in which Medicare and drug companies negotiated under the new Medicare Drug Price Negotiation program. As a result, the negotiated prices will save the Medicare program some $6 billion.

Before a crowd of thousands at the Price George’s Community College in Largo, Maryland, Biden and Vice President Kamala Harris who has become the presumptive Democratics nominee for president, made the announcement. 

“We finally beat Big Pharma,” said  Biden.

 Sixty-five million Medicare beneficiaries give Medicare “collecting bargaining power,” noted the Vice President. “And now Medicare can use that power to go toe-to-toe with Big Pharma and negotiate lower drug costs,” said Harris.

And that they did. 

Medicare’s Bargaining Power Puts the Brakes on Rising Drug Costs

 Empowered by the passage of IRA, Medicare was able to negotiate 38-79% discounts on 10 life-saving drugs that treat heart disease, diabetes, cancer, and other serious conditions.  These include popular, brand name drugs such as Eliquis, Jardiance, Farxiga, and Stelara — some of the expensive and commonly prescribed medications in the Medicare program.

 The Centers for Medicare and Medicaid Services (CMS) announced on Aug. 15, 2024, beneficiaries will now save $1.5 billion in out-of-pocket drug costs thanks to newly announced prices negotiated by the Medicare program with Big Pharma. The negotiated prices will save the Medicare program some $6 billion in costs. 

According to CMS, “the selected 10 drugs accounted for $50.5 billion in total Part D gross covered prescription drug costs, or about 20%, of total Part D gross covered prescription drug costs between June 1, 2022 and May 31, 2023, which is the time period used to determine which drugs were eligible for negotiation.”    8 Eight of the 10 drugs selected for this year’s negotiation program raised their prices in 2024 – after all 10 drugs were already priced three to eight times higher in the United States than in other countries, noted the federal agency.

The new prices take effect in January, 2026.  Under the IRA’s provisions, Medicare will select up to 15 more drugs covered under Part D for negotiation by Feb.1, and those prices will take effect in 2027. It will expand 20 drugs starting in 2028, says CMS. 

“It’s no exaggeration to say that this a truly historic moment.  We have been advocating for Medicare to have the power to negotiate drug prices with Big Pharma since 2003, when prescription drug coverage was added to the program,” said Max Richtman, President and CEO of the National Committee to Preserve Social Security and Medicare (NCPSSM).  “Unfortunately, the law literally forbade Medicare from negotiating prices with drug makers. The Inflation Reduction Act finally changed that, he said.

According to Richtman, billions saved are proof that the federal government can, and should, leverage its buying power to save Medicare beneficiaries  money — in this case, giving relief to millions of seniors of not having to pay for high drug costs. “This is momentous news for Medicare beneficiaries and the Medicare program itself,” he says.

“The negotiated prices of these first 10 drugs are a great start. We would like to see even more drugs included more rapidly in the negotiation process so that seniors can reap the maximum cost-savings that this process can provide,” said Richtman.                                                                                    

Responding to the White House’s announcement of new details about Medicare drug price negotiations, in a statement Richard Fiesta, Executive Director of the Alliance for Retired Americans, noted that it took more than two decades of activism on the ground, advocacy by thousands of members and the Biden Administration to push for passage of IRA, giving Medicare the power to negotiate fair prices to patients and taxpayers.

 “The savings are staggering. The new prices are 60% lower on average with two drugs slashed by more than 75% per month,” says Fiesta. “Combined with the $ 2,000 out-of-pocket cap on drug costs that will take effect in January, millions of Americans will not be healthier and more financially secure,” he says.

 Fiesta notes, according to the U.S. Congressional Budget Office, in future years, the prices of additional drugs will be negotiated and Medicare will save about $ 100 billion over 10 years. 

While Biden and Democratic lawmakers see the value of granting Medicare the power to negotiate with Drug Companies to lower high drug costs,  no GOP lawmaker voted to pass Biden’s IRA last year, a proposal that allowed Medicare to negotiate with drug companies to lower the cost of drugs.

Not Everyone is On Board 

The drug price policies of IRA were the topic of a Sept. 20, 2023  hearing of the Oversight and Investigations Subcommittee of. House of Representatives’ Energy & Commerce Committee. The hearing, “At What Cost: Oversight of How the IRA’s Price Setting Scheme Means Fewer Cures for Patients,” GOP lawmakers sitting on the panel and four witnesses warned how the drug price negotiations could hurt or help market conditions for new medicines.

 At the hearing, House Energy and Commerce Committee Chair Cathy McMorris Rogers (R-WA) warned that the “Democrat’s drug pricing control scheme was going to do immense harm to patients by crushing drug innovation.  She charged that “unaccountable bureaucrats -not cutting-edge science- backed with entrepreneurial initiative- dictate the value of new cures.”

At press time, GOP lawmakers have remained silent as to their thoughts about last week’s announcement of Medicare lowering the drug prices for ten of the most expensive drugs in Medicare.  

But not President and CEO Steve Ubl – Pharmaceutical Research and Manufacturers of America (PhRMA) President and CEO Steve Ubl quickly released a statement.

 “The administration is using the IRA’s price-setting scheme to drive political headlines, but patients will be disappointed when they find out what it means for them. There are no assurances patients will see lower out-of-pocket costs because the law did nothing to rein in abuses by insurance companies and PBMs who ultimately decide what medicines are covered and what patients pay at the pharmacy,” he said.

“As a result of the IRA, there are fewer Part D plans to choose from and premiums are going up. Meanwhile, insurers and PBMs are covering fewer medicines and say they intend to impose further coverage restrictions as the price-setting scheme is implemented. More than 3 million beneficiaries taking medicines with government-set prices will pay more in 2026,” adds Ubi.

Reflecting Roger’s opening hearing statement last year, Ubi noted: “The IRA also fundamentally alters the incentives for medicine development. Companies are already changing their research programs as a result of the law, and experts predict this will result in fewer treatments for cancer, mental health, rare diseases and other conditions. Medicine development is a long and complex process, and the negative implications of these changes will not be fully realized for decades to come.

“The ironically named Inflation Reduction Act is a bad deal being forced on American patients: higher costs, more frustrating insurance denials and fewer treatments and cures for our loved ones.” charges Ubi.

Following in PHARMA’s footsteps, drug companies also issued statements opposing the power given to Medicare to negotiate lower drug prices.  Novartis, manufacturer of Entresto, one of the 10 selected medicines participating in the price setting process issued a statement.   It called the negotiations “unconstitutional,” predicting “it would have long-lasting and devastating consequences for patients by limiting access to medicines now and in the future.”

Seniors Support Allowing Medicare to Negotiate Drug Costs 

As Congress began debated the merits of the IRA, a national poll of older Americans tracked wide-support for its provisions to reduce skyrocketing drug costs.

According to KFF Health Tracking Poll, a Oct. 12, 2021 poll, few accepted PHARMA and drug makers dire warnings that  high drug prices are necessary for supporting research into new drugs.  Giving the federal government the buying power to negotiate lower drug prices with drug makers and those enrolled in private plans were “favored by large majorities across the political partisans, even if they hear arguments from both sides,” said the San-Francisco-based  national newsroom that produces in-depth journalism about health issues.

KFF poll findings indicated that  83% of the public favor allowing the federal government to negotiate with drug companies to lower drug prices on behalf of people enrolled in Medicare beneficiaries and private plans. “This includes 91% of Democrats, 85% of independents, and 76% of Republicans, as well as majorities of seniors (84%), who would be most affected by such a provision, the findings indicate.

As older voters go to the polls, one thing is clear.  Lowering the cost of pharmaceuticals is a bipartisan issue.   When the dust settles after the November elections, those taking the reins of Congress must not forget this fact and continue to push for policies that will continue to work of IRA.

For fact sheet on Medicare Drug Price Negotiation Program, go to https://www.cms.gov/files/document/fact-sheet-negotiated-prices-initial-price-applicability-year-2026.pdf

House Select Committee on Aging has new life

Published in RINewsToday on July 29, 2024

Just a month ago, the Washington, DC-based Leadership Council on Aging Organizations (LCAO), a coalition of 68 national nonprofit groups committed to representing seniors in Congressional policy making, formally endorsed Cong. Seth Magaziner’s (RI-2) H. Res. 1029, reestablishing the House Select Committee on Aging (HSCoA).  

The freshman congressman picked up the baton from former Cong. David Cicilline, who resigned his seat and now heads the Rhode Island Foundation.  The former Congressman had introduced a resolution to bring back the HSCoA during the 114th-117th Congresses.

At press time, Magaziner’s resolution, introduced on Feb. 23, 2024 (with 26 Democratic co-sponsors and no Republicans on board), has been referred to the House Committee on Rules for mark-up, and if passed, will be considered by the full House.

LCAO endorsed Cong. Magaziner’s 213-word resolution in a June 25th letter. H Res. 1029 amends the Rules of the House to establish a HSCoA.  Although the panel will not have legislative jurisdiction, it’s authorized to conduct a continuing comprehensive study and review of a myriad of aging issues, from income maintenance, poverty, housing health (including medical and research, welfare, employment, education, recreation, to long-term care.

If passed, the Magaziner’s resolution would authorize the HSCoA to study the use of all practical means and methods of encouraging the development of public and private programs and policies which will assist seniors in taking a full part in national life and which will encourage the utilization of knowledge, skills, special aptitudes, and abilities of seniors to contribute to a better quality of life for all Americans.

Finally, H. Res. 1029 would also allow the HSCoA to develop policies that would encourage the coordination of both governmental and private programs designed to deal with problems of aging and to review any recommendations made by the President or by the White House Conference on Aging in relation to programs or policies affecting seniors.

LCAO Calls for Passage of H. Res. 1029

“As we all age together as a society, we see the need to find solutions as demand grows for paid and family care workers, along with finding opportunities to address retirement security. Addressing these demands in a fiscally responsible, bipartisan manner deserves greater attention, understanding and public engagement, says LCAO Chair Richard Fiesta, Executive Director of the Alliance of Retired Americans, in a June 25 letter written to Cong. Magaziner endorsing H. Res. 1029.

In the endorsement letter, Fiesta explained that while authorizing standing House Committees “perform exemplary oversight and legislative functions over matters within their respective jurisdictions, the HSCoA would have an opportunity to more fully explore a range of issues and innovations that cross jurisdictional lines, while holding field hearings, convening remote hearings, engaging communities, and promoting understanding and dialogue that would contribute to the solutions that present themselves as the number of older people in our nation increases.”

Looking back, LCAO’s letter noted that HSCoA, under Chairman Claude Pepper, closely worked with standing committees, in a team effort and a bipartisan manner, holding many joint hearings with them and helping to pass the end of mandatory retirement, 359-2 in the House and 89-19 in the Senate.”

Additionally, HSCoA “worked to protect Social Security, expose nursing home abuses and set transparency standards, expand home health care benefits as a way older people could often delay or avoid the need of entering into long-term care facilities, and so much more,” said Fiesta, noting that The Ways and Means, Education and Workforce, Energy and Commerce, and Space, Science and Technology were other committees that benefited from the partnership,” Fiesta said.

Finally, Fiesta stresses that HSCoA would also “complement the strong bipartisan work of the Senate Special Committee on Aging which has effectively promoted member understanding on a range of issues, including the concerns of grandparents raising grandchildren, elder abuse and fraud, the effects of the COVID-19 pandemic on older Americans and their families, the importance of financial literacy in planning for retirement, and the costs associated with isolation and loneliness.”

Magaziner talks turkey about H. Res. 1029

“Older Americans have worked hard their entire lives, and they deserve to retire and age with dignity,” says Magaziner, noting he became the primary sponsor of H. Res. 1029 because it “ensures that seniors in Rhode Island and across the country have their voices heard, needs met, and can enjoy their golden years with peace of mind.”

Magaziner was recently on parental leave and was unable to meet with former HSCoA staffers and aging advocates. He notes, however, that “my staff was able to listen to and gain valuable insight into the successes of the Committee and its role in fighting for America’s aging population.”  

According to Magaziner, his staff is working hard to tell other offices about the benefits of the proposed Committee and will continue to look for ways to raise the profile of this resolution to encourage other Members to become co-sponsors. “I am proud that this resolution received the recent endorsement from the LCAO, along with other prominent organizations including the National Committee to Preserve Social Security & Medicare, AARP, Alliance for Retired Americans, Social Security Works and Meals on Wheels America,” he said, stressing that the support of advocates is important to encouraging House lawmakers to cosponsor the resolution. 

Magaziner stresses that getting bipartisan support for H. Res. 1029 is important to him.  “I’m ready to work with anyone, from either party, to deliver results for Rhode Island—and that includes finding common ground on important legislation like H. Res. 1029,” he says.  “There’s still room for bipartisanship, and ensuring we address issues for seniors across the country should be an area where we can all agree,” he adds, calling on his Republican colleagues to work together with Democrats to move our country forward.

If not this year, push for next Congressional session

But with 98 days left before the upcoming presidential election, can Magaziner push H. Res. 1029 across the goal line?

With the House beginning its 6-week August recess, Bob Blancato, former Staff Director of the, Subcommittee on Human Services, urges voters to ask their lawmakers to support H. Res. 1029 if they are not a cosponsor. “Find them at public events and raise [the importance of their support], he suggests.  

Blancato sees the importance of Cong. Magaziner sending another “Dear Colleague” letter to House lawmakers in soliciting cosponsors. “They should also target some of the House Caucuses, such as the bipartisan Congressional Woman’s Caucus and the Assisting Caregivers Caucus,”  he recommends.

According to Bob Weiner, former Chief of Staff, House Select Committee on Aging under Chairman Claude Pepper (D-FL), the timing to push this resolution is after the upcoming presidential election.  “Most important will be to hit the ground RUNNING at the start of the next Congress, with the agreement by Cong. Magaziner to introduce the first new session day, and give him and the allied groups and supporters the immediate opportunity to build cosponsors at that time,” he says, stressing that the count for the next Congress begins in the next Congress, which could well be a different party majority. “This is a terrific resolution which can have significant impact helping older Americans to protect and build their health and livelihoods, he adds.

Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare (NCPSSM) and a long-time member of the LCAO, agrees with Weiner’s assessment.  “Historically, the House Permanent Select Committee on Aging served as a unique venue that allowed open, bipartisan debate from various ideological and philosophical perspectives to promote consensus that, in turn, helped facilitate the critical work of the standing committees.  We believe that issues affecting seniors would be best advanced by the re-establishment of such a Committee in the House. Reestablishing a Select Committee on Aging in the House would also complement the strong bipartisan work of its counterpart in the Senate.”

“As was emphasized in the LCAO endorsement letter, we need Cong. Magaziner to tactfully work for bipartisan support of his House Resolution — a commitment he made to the voters in a 2022 campaign press conference that I attended,” says Vin Marzullo, former federal civil rights & social justice administrator and a Board member of Senior Agenda Coalition.

“Additionally, since the Magaziner resolution has less than half of the cosponsors obtained by former Cong. Cicilline, both the Congressman and his staff must step up their outreach efforts to Congressional members on the floor, related House Committee Chairs, House Caucuses, & the House Minority Leader,” he said, noting that grassroots efforts led to the support of Cong. Josh Gottheimer (D-NJ), Co-Chair of the bipartisan Problem Solvers Caucus”, stated Marzullo, also a former AARP RI President.  

For details about the HSCoA, go to https://rinewstoday.com/congressman-magaziner-takes-baton-on-bringing-back-house-aging-committee-herb-weiss/.