Tag Archives for FY 2024 Budget

Trustee reports: Social Security and Medicare still face financial woes

Published in RINewsToday on April 10, 2023

Over a week ago, the Trustees of the Social Security and Medicare trust funds released their annual reports on the financial health of these two programs. As in prior years, the trustees found that the Social Security and Medicare programs both continue to face significant financing issues.

The latest Social Security projections show the program is quickly heading toward insolvency and calls for Congress to find policy solutions sooner rather than later to prevent abrupt changes to tax or benefit levels.  The Washington, DC-based National Committee to Preserve Social Security and Medicare (NCPSSM) and other aging advocates are urging Congress to take prompt action to strengthen and expand Social Security, while Republicans have been calling for cuts to future retirees’ benefits and at least partly privatizing the program. 

This 270- page 2023 Social Security Trustees Report warns that if Congress does not act, Social Security’s Old-Age and Survivors Insurance and Disability Insurance (OASI and DI) Trust Funds, which help support payouts for the elderly, survivors and disabled, will become depleted in 2033 (that’s a year earlier than forecast last year), becoming totally insolvent in 2034 when beneficiaries would only receive about 80% of their scheduled benefits. 

According to the Social Security Administration (SSA), roughly 66 million people received monthly Social Security checks in 2022 (175,840 in Rhode Island). A vast majority, or about 57 million of those beneficiaries, received benefits through the OASI Trust Fund, compared to nearly 9 million people who received benefits through the DI Trust Fund. 

The trustees say that Social Security funds would be fully depleted in 2034 because of expectations of a slowed economy and reduce labor productivity, considering inflation and economic input.

Although the DI Trust Fund asset reserves are not projected to become depleted during the 75-year projection period, being able to pay full benefits through 2097, the combined Social Security funds would only be able to pay 80% of the scheduled benefits after 2034, says the trustees report.

Taking a look at Medicare’s fiscal health

Medicare, the hospital insurance trust fund referred to as Medicare Part A, will only be able to pay scheduled benefits in full until 2031, according to the 273-page trustees’ annual report. The program covered 65 million seniors and people with disabilities in 2022, and will only be able to cover89% of total scheduledbenefits at that time.

Although the Medicare Part A Hospital Insurance trust fund will become insolvent in just eight years, Medicare spending as a whole (including Parts A, B, D, and Medicare Advantage, will continue to grow over the coming years.

The Medicare Trustees project a shortfall of 0.62 percent of payroll, or 0.3 percent of Gross Domestic Product (GDP), noting that it would take about a 21 percent (0.6 percentage point) increase in the payroll tax rate or a 13 percent spending cut to restore the program’s solvency.

The improvement of Medicare’s hospital trust fund’s finances over last year’s projections can be tied to lower estimates for health care spending after the height of the Covid-19 pandemic along with more projected income that the trustees estimate coming from a larger number of covered.

Dueling political statements

With the Social Security and Medicare Trust Fund reports released on March 31, 2023, the Chair and Ranking Members of the House Ways and Means (HWM) were quick to issue dueling statements to give their political spins. HMW’s Subcommittee on Social Security has jurisdiction on bills and matters related to the Social Security Act.

House Ways and Means Chairman Jason Smith (R-Missouri) charged that reckless Democratic spending has impacted the financial viability of the Social Security and Medicare Programs.  “Thanks to President Biden’s economic failures, seniors’ hard-earned benefits are further under threat. Social Security’s combined trust funds are expected to become insolvent a full year sooner than forecast in the previous report as a result of a slowed economy and Democrats’ inflation continuing to outpace wage growth. And Medicare’s latest report comes amidst Biden’s plans to slash seniors’ access to innovative new cures and treatments,” says Smith, stressing that “the first step to protecting these programs is “growing the economy – not budget gimmicks or tax increases that hold back economic growth.

On the other hand, House Ways and Means Committee Ranking Member Richard E. Neal (D-MA) counters Smith’s political perspective. “While Democrats are committed to the long-term health of these programs, Republicans are launching another shameful assault on the economic well-being of millions of workers and retirees with their plan to make drastic cuts to Social Security and Medicare, warns Neal. “Their playbook is clear: slashing a critical resource that Americans have rightfully earned to give another tax cut to the top 1%. Democrats won’t let their reckless attacks stand, and we will continue to defend and protect Social Security and Medicare for generations to come.”

Rhode Island Congressmen were quick to give their comments about the release of the two trustee reports, too. “Unlike the nearly three-quarters of House Republicans who endorsed slashing Social Security in 2022 – reducing benefits by $729 billion over 10 years – House Democrats are working to protect Social Security for generations to come,” says Congressman David N. Cicilline, representing Congressional District 1.  Cicilline, who is retiring his seat on May 31, 2023, has pushed to expand and strengthen Social Security over his six-terms in office.

Cicilline asks: “Sixty-six million Americans rely on this essential program to make ends meet and we cannot allow Republicans to make any cuts to this hard-earned benefit. The drug spending savings implemented by our Inflation Reduction Act will not only keep money in seniors’ pockets but will also drive down costs to Medicare itself. We’ve been taking real action to strengthen these programs and help our seniors – what have Republicans done?”  

As Rhode Island’s newly elected Congressman, Seth Magaziner says he will “fight tooth and nail to protect Rhode Islander’s hard-won Social Security benefits.”   In responding to the trustee’s report about Social Security’s financial woes, Magaziner called for raising the cap on Social Security taxes, forcing “millionaires and billionaires to pay the same rate as teachers and fire fighters.”

“I stand ready to work with anyone who is serious about strengthening Social Security, not cutting hard-earned benefits,” says Magaziner. 

While there are few fixes being proposed by either party or leader, some fixes identified by the Program for Public Consultation at the University of Maryland that “Americans might be willing to support” include:

–        raising the Social Security payroll tax cap

–        reducing benefits for high earners

–        gradually raising the retirement age

–        increasing the payroll tax

–        raising the minimum benefit

–        changing cost-of-living adjustment calculations

–        increasing benefits for beneficiaries over age 80

Social Security advocacy group gives its two cents

“Contrary to conservative claims, Social Security is not ‘going bankrupt’; the program will always be able to pay benefits because of ongoing contributions from workers and employers. In fact, this is yet another Trustees report showing that Social Security remains strong in the face of turmoil in the rest of the economy,” says Max Richtman, NCPSSM’s President and CEO in a release on the Social Security Trustee Report. He notes that the program’s insolvency date has stayed roughly the same even after a global pandemic and recent economic upheavals. 

Congress can strengthen Social Security by bringing in additional revenues into the program, says Richtman.  NCPSSM endorses legislation introduced by Senator Bernie Sanders (D-Vermont) and Congressman John Larson (D-Connecticut) to keep the trust fund solvent for the rest of this century while expanding program benefits.  Both bills would adjust the Social Security payroll wage cap so that higher-income earners begin contributing their fair share, he notes.

As to Medicare, in a release Richtman called on Congress to take “pre-emptive action now” to protect the Medicare Part A trust fund from becoming depleted in 2031, three years later than estimated in their previous report, at which time Medicare could still pay 89% of benefits.  

“Beyond trust fund solvency, the Trustees reported that the standard Medicare Part B premium will rise next year to $174.80 per month – a $10 or six percent monthly increase,” says Richtman. “Any increase is a burden to seniors living on fixed incomes, who too often must choose between paying monthly bills or filling prescriptions and getting proper health care.  Seniors need relief from rising premiums and skyrocketing out-of-pocket health care costs,” he said. 

“We support President Biden’s plan to strengthen Medicare’s finances, as laid out in his FY 2024 budget.  His plan would bring more revenue into the program, rather than cutting benefits as some Republicans have proposed.  Building on the prescription drug pricing reforms in the Inflation Reduction Act, the President’s budget proposal would lower Medicare’s prescription drug costs — and some of those savings would be used to extend the solvency of the Part A trust fund,” said Richtman.

For a copy of the 2023 Social Security Trustee Report, go to https://www.ssa.gov/OACT/TR/2023/.

For a copy of 2023 Medicare Trustee Report, go to https://www.cms.gov/oact/tr/2023.

RI Seniors, aging advocates call for an “age friendly” budget

Published in RINewsToday on March 27, 2023

Over two months ago, Gov. Dan McKee unveiled a sweeping $13.7 billion budget for the upcoming fiscal year.  After its release, the Senior Agenda Coalition of RI (SACRI), representing 21 organizations, called this budget “unfriendly to seniors,” charging that it “short-changed” seniors.  In an e-blast that was sent to 1,800 seniors and aging advocates SACRI urged them to contact their lawmakers asking that they put more funding into the delivery of aging programs and services.  

As the House Finance Committee continues to hold hearings on bills that might ultimately be rolled into the upcoming FY 2024 Budget, last week the SACRI brought 220 seniors, aging advocates and professionals in the aging network to the Warwick Crown Plaza to personally urge House Speaker Joe Shekarchi (D-Warwick) and Senate President Dominick Ruggerio (D-Providence, North Providence to hammer out an “age-friendly” budget.

SACRI Board Chair George Neubauer began this year’s Legislative Leaders Forum by quoting President Joe Biden’s call to Congressional lawmakers at the annual State of the Union Address to maintain Medicare and Medicaid. The President urged lawmakers to “stand up for seniors”.  Setting the stage for why this event was organized, Neubauer told the packed room: “Today, we are here to speak up for ourselves.”

Painting a Portrait of Rhode Island Seniors

“Effective advocacy includes good data and good stories,” said Maureen Maigret, a SACRI Board member and policy advisor for the group setting the stage for the speakers. She presented demographic data on the state’s graying population, discussed the increased needs of state’s aging programs and services to keep people at home, and detailed SACRI’s budget policy fixes.

“We speak up for 200,000 seniors and our numbers are growing,” says Maigret, also a former State  Representative and Director of the RI Department of Elderly Affairs. By 2030, 1 in 5 Rhode Islanders will be aged 65 and over,” she says.

While many think that seniors are a drain on the economy, they are not. According to Maigret, $3 billion dollars in Social Security benefits are pumped into the state’s economy. Twenty percent of seniors are still working and paying taxes and employers are very aware that seniors have extensive job experience skills and are usually very reliable employees.

“Additionally, seniors are part of an invisible workforce of unpaid caregivers who take care of family members and friends, also,” says Maigret, noting that AARP Rhode Island recently released a study reporting that there are 121,000 unpaid caregivers, with the value of their unpaid care estimated to be $2.1 billion dollars (just under $19 per hour).

“Seniors also contribute thousands of hours of volunteer work to their local communities, lending a helpful hand to senior centers, friendly visitor programs, Meals on Wheels, and to the Village Common of RI at four Village communities and multiple other agencies,” adds Maigret.  

“An overwhelming 70% of Rhode Island seniors want to age in place and remain in their communities,” says Maigret, noting that “after age 65, 3 out of 5 of these individuals will need some support to stay in their homes.”

SACRI survey on areas of concern for seniors

With Rhode Island’s top House and Senate leadership listening, Maigret touched on the findings of a SACRI survey that identified an array of concerns expressed by their older constituents.  Health and care issues came up on the top of this list, followed by isolation and loneliness, lack of knowledge of community support services, the need for transportation, loss of mobility, high housing costs, and lack of income.

The survey findings indicate that needed information is not reaching older adults to navigate the long term care system, says Maigret. Forty percent do not know about programs and services offered by Rhode Island’s Office of Healthy Aging (OHA) and The Point, the state’s aging and disability resource center.  She noted that the Governor’s FY 2024 budget didn’t allocate any state dollars to operate The Point, whose mission is to direct seniors to needed programs and services.

“Even with Social Security, a large number of seniors have low incomes,” says Maigret, with 50% of older households living on less than $50,000 a year, another 27% living on less than $25,000. “The cost of long-term care is staggering and unaffordable with semi-private rooms in nursing facilities going for $94,900 a year,” she pointed out. “Assisted living facilities is out of reach for many, too, costing about $54,000 a year. Bringing a home care aide 40 hours per week into a person’s home costs a whopping $56,160,” she adds.

Maigret urged Shekarchi and Ruggerio to reallocate more state dollars to home care services.  While other states, on average, spend 45% of Medicaid long-term care dollars on home care, Rhode Island only spends 22% with hundreds of seniors having to wait over 3 months to get home care services.

Maigret says that SACRI supports a legislative agenda that calls on the Rhode Island General Assembly to craft a “Better Budget for Better Care,” which will result in a permanent investment to improve the care provided to seniors.  SACRI also urges that lawmakers raise direct workers pay to $20 per hour to attract workers into home care agencies and nursing facilities. To assist seniors to access needed programs and services, $500,000 must be allocated into the House budget to better market available information and referral services offered by The Point.  

“Meanwhile, SACRI also is pushing to add five new positions at the OHA, with two being assigned to its Adult Protective Services Unit to increase increased caseloads,” says Maigret.  By allocating funding to help more lower income Medicare beneficiaries pay their Medicare Part B premiums, seniors will have more money to pay their bills.     

Telling Powerful Stories

SACRI pulled together a few “real life” stories to illustrate why Rhode Island lawmakers must craft an “Age Friendly” FY 2024 Budget.

Jeanne Gattegno, working in the elder abuse sector, shared her thoughts as to why OHA’s Adult Protective Service Unit (APSU) is underfunded.  “Elder abuse is a crime and anyone suspecting abuse must report it.  When its reported it must be investigated by the APSU,” she says.

According to Gattegno, in 2021, there were over 6,200 calls to OHA, over 1,400 calls were elder abuse complaints, and 2,800 were investigated as self-neglect. “There are five workers in the APSU. Just do the math. It’s an incredibly difficult job and it’s life and death and there are not enough people to help,” warns Gattegno.

Allyson Manning, an overworked Registered Nurse at a local nursing facility, highlighted her typical day working with two Certified Nursing Assistants to take care of 26 residents.  Due to low wages, the facility can’t fill the third CNA position to assist the other two CNAs on the shift. 

Serving as Team Leader, Manning says that there is not enough time to take care of her 26 residents.  During this shift her chief responsibility is to pass medications, perform treatments and assessments.  She often finds that her primary functions as an RN are late or difficult to carry out, due to the need to assist the CNAs with their tasks of toileting, washing, dressing and feeding residents.

“We are not attracting the people we need to these [CNA] positions.  They are low paid jobs, but it is really rewarding work but it is hard work., she says.  When hired, CNA’s are not staying long, turnover is high says Manning. While initially working full-time, she now only works two days a week.  

Giving Their Thoughts…

RI Speaker of the House, Joe Shekarchi remarked that he clearly understood the very powerful stories shared by Gattegno, Manning and others. “I didn’t need to hear those stories because I live those stories every day.  When his 97-year-old father recently fell at home and broke his pelvis, he was admitted to the Bethany House.

“I see how hard they work and the limited staff they have,” says the House Speaker, understanding the labor shortage’s impact on nursing facilities. “I see when my father hits the call button and it takes a long time [to answer] not because they are slow, but because they are doing three or four things at the same time,” he says.

“It’s important that seniors have options so they can choose what’s best for them,” says Shekarchi. “We need to provide supports for seniors to age in place and remain in their homes living independently,” he added, acknowledging that it is not always easy to do.

Shekarchi also recognized his effort with the Senate President made historic investments to require minimum staffing last year. Unfortunately, it hasn’t happened because the nursing facilities are now facing labor shortages, he says. 

According to Shekarchi, last year the General Assembly also provided more funding to make home care more accessible for seniors.  Lawmakers also provided tax relief on pensions for older taxpayers and military veterans, strengthened laws to protect seniors from financial exploitation, and made it easier to apply for SNAP benefits and expanded property tax relief for seniors. He expects to continue his efforts this legislative session.

Shekarchi also reported that he has introduced a bill, supported by AARP RI, to allow zoning for constructing Accessory Dwelling Units (ADUs) in garages or basements. He called on seniors and aging organizations to support his housing bill.

The House Speaker also discussed proposed legislation by Rep. Lauren Carson (D-District 75, Newport) proposed legislation that would create a House Study Commission to coordinate Rhode Island’s programs and services for seniors, expressing the need for such a study commission.  

Like Shekarchi, Senate President Dominick Ruggerio outlined a number of legislative successes last year.  He recognized passage of Sen. Josh Miller’s legislation authoring the creation and implementation of a pharmaceutical redistribution program. Former Sen. Cindy Coyne’s legislation became law, too, lowering the age at which a victim can be considered an elder under the state’s financial exploitation law from 65 to 60.

With the state’s growing number of seniors, Senate President Ruggerio stated that senior issues are more important than ever.

“We need to do everything we can to ensure seniors and retirees can enjoy their older years with dignity and security,” he said. “Because after a lifetime of hard work and contributing to our communities… older Rhode Islanders deserve nothing less.”

“The Senior Agenda Coalition is a powerful tool in its work.  At the Statehouse we rely on your voices to help guide us as leaders,” says Ruggerio, noting “we don’t have all the answers and appreciate your input.”

To watch SACRI’s 2023 Legislative Leaders Forum, go to  https://ritv.devosvideo.com/show?video=7cd34a907d29&apg=c7e3a6c7.