Jace Brady
[email protected]
Seniors, brace yourselves, because winter is coming. Over the last several weeks, the Center for Medicaid and Medicare Services released plans for Medicare Part B rate hikes that could amount to hundreds of dollars a month for certain seniors. If this announcement wasn’t disappointment enough, on Oct. 15, the Social Security Administration added to seniors’ woes by announcing there would be no cost of living adjustment for Social Security payments in 2016.
Many seniors have had a difficult time over the last decade as low bond rates have forced them to invest their retirement funds in riskier investments in order to keep them solvent, and low inflation has minimized the number of cost of living adjustments they have received. However, the items the elderly spend money on have continued to get more expensive: health care, medication, insurance premiums, and for the lucky few with a little left over, travel.
Medicare Part A is funded through payroll taxes and does not require premiums from seniors to receive services. However, the Congressional Budget Office predicts the trust that funds these benefits will be insolvent in the next few decades. To prevent a similar destiny for Medicare Part B, which does collect premiums, Center for Medicaid and Medicare Services has simply decided to raise premiums dramatically to fund the increased costs of seniors’ health care. Year after year, seniors have paid a greater portion of their income toward health-care costs for the last decade, and these premium increases will likely dissolve senior discretionary income even further. These premium increases are likely just the first step as congressional leaders look to decrease the costs of the behemoth that is Medicare. In the future, lawmakers will look for more ways to decrease costs which may include increased deductibles, decreased service coverage, and more premium increases, all of which will diminish seniors ability to care for themselves.
Seniors are likely to struggle a little bit more next year receiving the same amount of money that they received in 2015 from Social Security payments. While cost of living in Iowa has actually seen a 0.1 percent decrease over the last year, this doesn’t take into account the unique situation of seniors. Health-care costs are rising, and many seniors spend nearly 20 percent of their income on these expenses. In addition, the Federal Reserve is anticipating a hike in interest rates late this year or early next year, which will likely propel the inflation rate.
While Medicare premium increases won’t affect all seniors, the rise in health-care costs will. The University of Iowa has led the way in attempting to decrease the cost of providing care for seniors by starting an Accountable Care Organization. This and other efforts will hopefully help shift the burden of health-care costs from collecting more funds from seniors to reducing the cost of providing care to them. The government does need to find ways of keeping Medicare and Social Security solvent, but it would need to be done with long-term solutions that don’t include bankrupting our oldest generation.
Seniors, brace yourselves, because winter is coming. Over the last several weeks, the Center for Medicaid and Medicare Services released plans for Medicare Part B rate hikes that could amount to hundreds of dollars a month for certain seniors. If this announcement wasn’t disappointment enough, on Oct. 15, the Social Security Administration added to seniors’ woes by announcing there would be no cost of living adjustment for Social Security payments in 2016.
Many seniors have had a difficult time over the last decade as low bond rates have forced them to invest their retirement funds in riskier investments in order to keep them solvent, and low inflation has minimized the number of cost of living adjustments they have received. However, the items the elderly spend money on have continued to get more expensive: health care, medication, insurance premiums, and for the lucky few with a little left over, travel.
Medicare Part A is funded through payroll taxes and does not require premiums from seniors to receive services. However, the Congressional Budget Office predicts the trust that funds these benefits will be insolvent in the next few decades. To prevent a similar destiny for Medicare Part B, which does collect premiums, Center for Medicaid and Medicare Services has simply decided to raise premiums dramatically to fund the increased costs of seniors’ health care. Year after year, seniors have paid a greater portion of their income toward health-care costs for the last decade, and these premium increases will likely dissolve senior discretionary income even further. These premium increases are likely just the first step as congressional leaders look to decrease the costs of the behemoth that is Medicare. In the future, lawmakers will look for more ways to decrease costs which may include increased deductibles, decreased service coverage, and more premium increases, all of which will diminish seniors ability to care for themselves.
Seniors are likely to struggle a little bit more next year receiving the same amount of money that they received in 2015 from Social Security payments. While cost of living in Iowa has actually seen a 0.1 percent decrease over the last year, this doesn’t take into account the unique situation of seniors. Health-care costs are rising, and many seniors spend nearly 20 percent of their income on these expenses. In addition, the Federal Reserve is anticipating a hike in interest rates late this year or early next year, which will likely propel the inflation rate.
While Medicare premium increases won’t affect all seniors, the rise in health-care costs will. The University of Iowa has led the way in attempting to decrease the cost of providing care for seniors by starting an Accountable Care Organization. This and other efforts will hopefully help shift the burden of health-care costs from collecting more funds from seniors to reducing the cost of providing care to them. The government does need to find ways of keeping Medicare and Social Security solvent, but it would need to be done with long-term solutions that don’t include bankrupting our oldest generation.