AARP Says Age Discrimination Robs $850 Billion from Nation’s Economy

Published in the Woonsocket Call on February 9, 2020

In 1985, my 71-year old father was ready to leave his job, looking for greener pastures. After working for Dallas, Texas-based Colbert-Volks for over 33 years as Vice President, General Merchandise Manager, he knew it was time for a job change.

After telling me of his desire to find a new employment, I told my father that he would bring over three decades of experience in the retail sector to a new company along with a vast network he had accumulated. I remember saying “You would be a great catch.” His curt response: “Nobody will hire me at my age.”

Thirty-five years after this conversation, AARP releases a report charging that age discrimination is still running rampant in America’s workplaces and it even negatively impacts the nation’s economy, too.

Last month, AARP and the Economist Intelligence Unit released a report, The Economic Impact of Age Discrimination, reporting that the age 50 and over population contributed 40 percent of the U.S. Gross Domestic Product (GDP) in 2018, creating 88.6 million jobs and generating $5.7 trillion in wages and salaries through jobs held directly or indirectly.

But older workers would have contributed a massive $850 billion more in 2018 to the GDP if they could have remained in or re-entered the labor force, switched jobs or been promoted internally, notes the AARP study.

AARP’s new study shows that the elimination of that bias in 2018 would have increased the contribution of the 50-plus cohort to the GDP from $8.3 trillion to $9.2 trillion. It also projects that the potential contribution of the older population could increase by $3.9 trillion in a no-age bias economy, which would mean a total contribution of $32.1 trillion to GDP in 2050.

“This important report shows the cost to the entire economy of discriminating against older workers,” said Debra Whitman, AARP’s Executive vice president and Chief Public Policy Officer in a Jan. 30, 2020 statement announcing the release of the 22-page report. “The economy in 2018 could have been 4 percent larger if workers did not face barriers to working longer,” says Whitman.

“Studies have shown that older workers are highly engaged, with low turnover, and often serve an important role as mentors,” Whitman added. “Their expertise helps businesses and pays big dividends for the economy as a whole. Employers who embrace age diversity will be at an advantage,” she says.

House Moves to Combat Age Discrimination

The groundbreaking AARP report comes on the heels of the House of Representative’s recent passage of HR 2030, “Protecting Older Workers Against Discrimination Act,” to combat age discrimination.

The House chamber’s action comes as older workers play an increasingly important role in the workforce. Estimates are that by 2024, 41 million people ages 55 and older will be in the labor force, nearly an 8 percent increase from the current number. In addition, next year the oldest millennials will start turning 40 and then will be covered by the Age Discrimination in Employment Act (ADEA).

The legislation, passing with bipartisan vote of 261-155, restores anti-discrimination protections under the ADEA that were weakened by the Supreme Court’s 2009 decision in Gross v. FBL Financial Services, Inc. The decision changed the burden of proof for workers to be the sole motivating factor for the employer’s adverse action, making it much harder for workers to prove age discrimination.

In the Senate, the bipartisan companion legislation (S.485) is sponsored by Senators Chuck Grassley (R-Iowa) and Bob Casey (D-PA).

“The House vote sends a strong bipartisan message that age bias has to be treated as seriously as other forms of workplace discrimination,” said Nancy LeaMond, AARP Executive Vice President and Chief Advocacy & Engagement Officer. “Age discrimination is widespread, but it frequently goes unreported and unaddressed,” charges LeMond.

Thoughts on Age Discrimination

AARP’s new report includes survey findings gleaned from a study conducted last July and August, interviewing 5,000 people age 50-plus to identify how they have experienced age discrimination at work or while looking for work.

The researchers analyzed: involuntary retirement due to age bias; 50-plus workers involuntarily in part-time jobs; missed opportunities for wage growth; lost earnings following involuntary job separation; longer periods of unemployment compared to younger workers; and people age 50 and older who dropped out of the labor force, but want to continue working.

The study’s findings indicate that the age 50 and over labor force has grown by 80 percent since 1998, about 40 percent of workers age 65 over intend to continue working into their 70s. While 80 percent of employer’s support employees working into their later years, nearly two-thirds of older workers say they have experienced or seen age discrimination in the workplace.

As to gender, the study’s findings note that men who retire between ages 50 and 64 are most likely to feel that they are being forced into retirement because of their age. Older women bear the double burden of age and gender discriminate, say the researchers. Those age 50-64, especially women, experience longer unemployment than other groups

The study also found that lower-income workers are more likely to feel trapped in their present role as a result of age discrimination.

AARP’s report warns that “in order to benefit from age ‘inclusion,’ employers need not only to recognize age bias, but actually “actively” stop it; they need to “bust myths” about older workers, be it that they cost too much or are not tech-savvy; they need to recognize the value that experienced workers bring to the workplace, like their dependability and ability to problem-solve and remain calm under pressure, and they must build and support a multigenerational workforce.”

Final Thoughts

We have worked for years to raise awareness of valuing people in the workforce, regardless of age,” said AARP Rhode Island State Director Kathleen Connell. “This isn’t AARP rhetoric. Data repeatedly proves that age discrimination is not only is unfair to older workers, but something that also has a negative impact on the economy.

“Employers should take advantage of the best talent available without dismissing equally capable employees at a certain age or by choosing not to hire new workers simply because of their age,” Connell added. “Companies with a diverse cultural often laud that as a business asset. That philosophy should not exclude older workers. They can bring experience and wisdom into the mix and should be judged only on their performance.”

For information on AARP workforce-related resources, go to http://www.aarp.employers.

For a copy of AARP’s report, go to http://www.aarp.org/content/dam/aarp/research/surveys_statistics/econ/2020/impact-of-age-discrimination.doi.10.26419-2Fint.00042.003.pdf.

Democratic House Passes Landmark Legislation to Drive Down Spiraling Prescription Drug Costs

Published in the Woonsocket Call on December 16, 2019

Just days ago, the Democratic House leadership successfully pushed for passage of landmark legislation, the Elijah E. Cummings Lower Drug Costs Now Act (H.R. 3), that would give Medicare the power to negotiate directly with drug companies to bring down pharmaceutical prices and make those savings available to seniors.

House Democrats passed Speaker Nancy Pelosi’s sweeping legislation on Dec. 12 to lower the cost of prescription drugs on a largely party-line vote. The bill, which passed 230 to 192 with unanimous Democratic support and the backing of two Republicans, Reps Brian Fitzpatrick (R-Penn) and Jamie Herrera Beutler (R-Wash), is considered “dead on arrival” in the Senate. The White House has indicated President Trump would veto H.R. 3 it if it came to his desk.

The House Republicans fought to block passage of H.R. 3 by releasing their own legislative proposal, H.R. 19, to lower drug costs. The bill, consisting of bipartisan legislative provisions to lower drug costs that had already been adopted, would have achieved lower drug prices without imposing government price controls that House Republicans believed would decrease research and development spending for new drug cures.

Although House Republican Whip Steve Scalise called on the Democratic leadership to bring H.R. 19, with 135 sponsors and no Democrats, to the House Floor, the GOP proposal did not receive a vote on its own. It was offered by Rep. Greg Walden (R-Ore.) as an amendment to H.R. 3 and failed by a vote of 201 to 223, getting eight Democrat votes.

The Nuts and Bolts

H.R. 3 would put the brakes of spiraling drug cost by giving power to the Secretary of the Department of Health and Human Services to negotiate directly with drug companies to force real price reductions while also ensuring that seniors never lose access to the medicines they need. The legislation also expands access to the lower, negotiated drug prices to persons with private insurance, not just Medicare beneficiaries.

The 320-page House bill also prevents pharmaceutical companies from price gouging patients by capping the maximum price for a negotiated drug at the average price people in countries similar to the U.S. pay. It would create a brand new, $2,000 out-of-pocket limit on prescription drug costs for Medicare beneficiaries and even delivers vision, dental, and hearing benefits to Medicare beneficiaries for the first time.

H.R. 3 also increases the number of low-income seniors eligible for assistance with their drug costs and cost sharing for hospital and doctor visits. By extending guaranteed issue protections to disabled beneficiaries and to individuals who want to switch from Medicare Advantage to traditional Medicare, the legislation improves access to private supplemental coverage that helps fill in Medicare’s gaps for beneficiaries in traditional Medicare.

“The U.S. House of Representatives resoundingly defied Big Pharma today by-passing historic legislation to lower prescription drug prices for America’s seniors and their families. The Lower Drug Costs Now Act (H.R. 3) accomplishes what we and other advocates have long demanded — that Medicare be empowered to negotiate prices with pharmaceutical companies, which the CBO says will save more than $450 billion in drug costs. It also caps Medicare beneficiaries’ out-of-pocket prescription drug costs at $2,000 per year, says Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare, in a statement.

The Pros and Cons of H.R. 3

Richtman says that it is time for the Senate Chamber to act. Drug pricing legislation that passed by the Senate Finance Committee has not been brought up for a vote on the Senate floor. “We insist that the Senate follow the House’s lead and act now to lift the burden of crushing prescription drug prices. Seniors who have been rationing pills or foregoing other necessities in order to afford crucial medications have waited long enough,” he says.

In a statement released following House passage of H.R. 3, AARP Executive Vice President and Chief Advocacy and Engagement Officer Nancy LeaMond, called the legislation” a bold step toward lowering prescription drug prices and high out-of-pocket costs for millions of older Americans.”
“High drug prices disproportionately hurt older Americans, particularly Medicare Part D enrollees, who take between four and five prescription medications each month and have an average annual income of just over $26,000 a year. The average annual price of a specialty drug used on a chronic basis is now $79,000. Medications cannot work if they are unaffordable, says LeaMond.

Adds AARP Rhode Island State Director Kathleen Connell, “Drug companies are price-gouging older Americans and taxpayers– who pay the highest drug costs in the world,” noting that “AARP is proud to support H.R. 3, which would allow Medicare to negotiate drug prices and cap out-of-pocket costs for Part D enrollees. The bill also enhances Medicare by improving access and adding needed dental, hearing, and vision coverage.”

Opposing the passage of H.R. 3, the White House says in a statement, “Heavy-handed government intervention may reduce drug prices in the short term, but these savings are not worth the long-term cost of American patients losing access to new lifesaving treatments.” Noting that lowering the price of prescription drugs is major concern for seniors, the White Houses warned that H.R. 3 is the wrong approach to address this issue, “especially when bipartisan legislative alternatives that encourage innovation while lowering prescription drug

During a briefing with reporters over two months ago, President and CEO Stephen Ubl, of the Pharmaceutical Research and Manufacturers of America (PhRMA), warned the passage of H.R.3 would trigger “nuclear winter” for biotech innovation. Fiercely opposing passage, PhRMA has called on the Senate to “stop H.R. 3 in its tracks.”

Putting the Brakes on Rising Drug Costs in Rhode Island

“We all know someone who has been forced to ration the medication they need to live so that they can afford to keep a roof over their family’s heads or put food on the table. In America, in 2019, this should never be the case,” said Congressman David N. Cicilline (D-RI), who voted to pass the measure. “Pharmaceutical companies have abused American patients and taxpayers to increase their profits hand over fist without recourse for too long. The Lower Drug Costs Now Act will put an end to the price gouging by big pharma that sees American patients and taxpayers paying more for their prescription drugs than people in other countries, says the Rhode Island Congressman representing the state’s first congressional district.

In his 2016 campaign, President Donald J. Trump supported the government to negotiate drug prices. Cicilline calls on the president to honor this promise and urges Republican Senate Majority Leader Mitch McConnell to bring a companion measure to the Senate floor for consideration. At press time more than 300 House passed bills are stuck in the Senate (about 275 are bipartisan).

According to Cicilline, the out-of-pocket savings to Rhode Islanders will be substantial. “This year alone, more than 1,000 women in the state will be diagnosed with breast cancer, 550 people will be told they have prostate cancer, and 190 folks will be diagnosed with leukemia. H.R. 3 will lower the average costs of many popular medications for these and other cancer treatments. The cost of Ibrance for treating breast cancer will be reduced by as much as 65 percent. Zytiga, a common prescription for people with prostate cancer, will be reduced by as much as 66 percent. And the cost of Tasigna, which is commonly prescribed to people with leukemia, will go down by as much as 71 percent,” says Cicilline, who serves as the Democratic Policy and Communication Committee Chair.

Earlier this year, the Rhode Island Congressman released information detailing how much more Rhode Islanders with diabetes pay for their insulin than people in other countries. Currently, 8.6 percent of Rhode Islanders, just over 83,000 people, have diabetes. They pay from $1,200 to $20,000 per year for the most commonly used insulin medications. Under the newly passed H.R. 3, the average total cost of NovoLOG Flexpen, a common insulin medicine, would decrease by as much as 76 percent. Under H.R. 3, Rhode Islanders could spend 3.5 times less on insulin, and some of the commonly used insulins could cost as little as $400 per year.

According to Cicilline, seniors in his Congressional District will see Medicare improvements if H.R. 3 becomes law. At this time, Medicare does not provide coverage for: oral exams for 71 percent of beneficiaries, eye exams for 66 percent of beneficiaries, hearing exams for 66 percent of beneficiaries, dental exams for 75 percent of beneficiaries, eye glasses for 75 percent of beneficiaries, and hearing aids for 86 percent beneficiaries.

Under H.R. 3’s Medicare expansion, 93 percent of beneficiaries (98,800 people) stand to gain from adding a dental benefit, 75 percent of beneficiaries stand to gain from adding a vision benefit, and 97 percent (102,700 people) of beneficiaries stand to gain from adding a hearing benefit.

On December 6, Senate Finance Committee Chairman Chuck Grassley (R-Iowa) and Ranking Member Ron Wyden (D-Ore.) released an updated version of their bipartisan Prescription Drug Pricing Reduction Act of 201. Will McConnell, who controls its legislative fate, allow it to be considered on the Senate floor? Can a conference committee iron out the different between a Senate bill and H.R. 3, that can be pass both chambers and be signed by the president?

The legislative clock is ticking. It’s 324 days until the upcoming 2020 presidential election and the voters are demanding Congress to put aside philosophical policy differences and come up with a compromise that will truly put the brakes on rising drug costs. We’ll see.

Herb Weiss, LRI’12, is a Pawtucket writer covering aging, health care and medical issues. To purchase Taking Charge: Collected Stories on Aging Boldly, a collection of 79 of his weekly commentaries, go to herbweiss.com.