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Medicare, Social Security & Long Term Care

Illinois Alliance for Retired Americans

The Illinois Alliance for Retired Americans (IARA) is our partner on issues of importance to seniors. For more information and about getting involved, go to their website at www.illinoisretiredamericans.org

The website includes:

  • A calendar of events
  • Video of events
  • Up-to-date information about national and local news
  • A newsletter
  • The list of IARA affiliates

 

Protecting Social Security

Citizen Action/Illinois will work to protect Social Security for all generations.   Congress must not deal with the federal deficit by cutting Social Security because doing so will be removing a vital lifeline and throwing millions of people into an uncertain and insecure future.  Social Security is there not only for retired Americans, but it also pays benefits to young workers and their families if they become disabled. Social Security provides benefits to the survivors of deceased workers, including their children.  About one in six Americans (51.9 million) receives a Social Security benefit and 37 percent of them are not retired workers.  

  • By the end of 2001, about 3.1 million young people under age 18 were receiving Social Security benefits at the end of 2007 with an average monthly benefit of $477 and about 136,491 students ages 18 and 19 were receiving an average monthly benefit of $610.
  • Approximately 794,677 disabled adult children, disabled individuals age 18 and older were receiving an average monthly benefit of $660 at the end of 2007.

 What does the polling say on Americans’ views about what to do about Social Security?

Americans overwhelmingly support preserving and strengthening Social Security over reducing the deficit. 


Americans support Social Security because they value it for themselves, for their families and for the security it provides to millions of other people.  This strong support is common along party lines (see Table 4) [1]

Moreover, Americans would rather pay more in Social Security taxes than see benefits cut.  In a recent poll, 77 percent of Americans across party lines agree that it is critical to preserve Social Security for future generations, even if it means increasing contributions to Social Security from both the middle class and the wealthy.  Agreement comes from all political affiliations. [2]

When it comes to solutions, Americans overwhelmingly oppose benefit cuts like raising the retirement age limiting benefits while they support revenue raisers like raising the taxable income cap (See Table 7). [3]

How would raising the payroll tax cap affect Social Security's finances?

Currently, wages over a certain annual total ($106,800 this year) are exempt from Social Security payroll taxes, meaning income above that level is not taxed.   The cap means that higher-income individuals pay a smaller share of their income in Social Security taxes than middle-class employees:  including Social Security and Medicare taxes, earners in the middle fifth of the income distribution pay an average payroll tax of about 11 percent while the top 1 percent of earners pay just 1.5 percent. [4]

Many advocates and members of Congress have proposed raising or eliminating the cap on taxable earnings and crediting it toward benefits, similar to Medicare which has no cap.  This small adjustment in the taxable income cap could make the Social Security system solvent and close the projected shortfall without increasing the tax burden on middle-income families since only 6 percent of people earn more than $106,800 annually.

How can we afford Social Security when people are living longer?  Should we raise the retirement age?

The program was set up to let people retire comfortably, not make them work when they are feeble and can’t work anymore.  Some people are unable to work as long as others, especially those with physically demanding jobs. 

Many proposals to raise the retirement age and to index benefits for increased life expectancy (the longer people live, the higher the retirement age would go), and disadvantage the people who die younger--many of whom are lower-income people who retired from physically-demanding jobs. 

With the economy in its current state, we should not raise the retirement age.  People’s 401(k)s have crashed, school loans are increasing and people are losing jobs.  We must keep the safety net intact, not weaken it.

Why shouldn’t Social Security be part of the deficit solution?

Social Security did not cause the deficit and should not be cut to deal with it.  Despite recent claims by deficit hawks, there is not a lack of money to fund benefits.

Under current law, Social Security is not part of the general budget, has its own revenue stream and is forbidden by law from borrowing.  Some proposals free up Social Security for fast-track cuts by turning it into a regular line item in the budget.  Additionally, solvency projections change every year; triggers like these could force big changes to Social Security based on short-term financial variations.

 

During this time of record unemployment and home foreclosures, 77% of Americans agree that the last thing we should do is cut a vital program that keeps millions of people afloat and out of poverty.

 



[1] http://www.nasi.org/sites/default/files/research/SS_Brief_035.pdf

[2] http://www.nasi.org/sites/default/files/research/SS_Brief_035.pdf

[3] http://www.nasi.org/sites/default/files/research/SS_Brief_035.pdf

[4] http://www.epi.org/analysis_and_opinion/entry/raising_cap_on_social_security_tax_best_way_to_fix_shortfall/

 

Medicare Education and Advocacy Campaign

Citizen Action/Illinois has led campaigns for more affordable prescription drug coverage for seniors and people with disabilities at the state and national levels for over a decade.  In 2010 we won stronger Medicare Part D coverage for the doughnut hole.   In 2011 we fought at the state level to keep the ICRX program which helps fill in the gaps of Medicare Part D for lower income seniors.  While the ICRX program will be cut back it was not eliminated which was the state budget’s original intention.

 

Long Term Care

In 2003, Citizen Action/Illinois passed landmark legislation to create the Illinois Long Term Care Council to ensure that consumers receive high quality long-term care in Illinois and that our Illinois Long Term Care Ombudsman program is effective and independent.

The Council has adopted by-laws and has had preliminary training at each meeting on current issues affecting the ombudsman program, residents and rights to quality of life and quality of care in long term care systems.

The number of older persons needing long-term care services nationwide is estimated to rise from 7 million in 1990 to 9 million in 2005 and to 12 million in 2020. There are several trends emerging that must be addressed to effectively serve older persons with disabilities, in preparation for the Baby Boomers. These trends include:

  • The growth in the older population, which is skewed toward the 75, and older age categories in the last decade will shift to the younger old in the next two decades.

  • The disability rates among older persons have declined substantially because of socioeconomic and medical intervention improvements.

  • The socioeconomic improvements will increase the service options available to older persons.

  • There is a narrowing of the ratio of men to women in old age, which has contributed to the declining use of institutional care.

  • Utilization trends for long term supportive services differ substantially among racial/ethnic groups. For example nursing home care rates have declined for Whites but have increased substantially for African-Americans.

  • Assisted/supportive living facilities have grown substantially, but the extent that it will replace nursing home services is not known, or whether they will eventually be somewhat like nursing homes.

Nursing Home Liability Insurance

Illinois has approximately 1,200 long term care facilities serving more than 100,000 disabled or elderly residents. In 2006, the Illinois Department of Health took action against approximately 246 facilities which were determined to be in violation of the Nursing Home Care Act.

Unlike other businesses, these Illinois nursing homes are not legally obligated to carry liability insurance. Citizen Action/Illinois supports amending the Nursing Home Care Act and the State Mandate Act to protect nursing home residents. If passed, individual and corporate owners of nursing home facilities would not be allowed to escape liability when the care of our most vulnerable members of society and their very lives are at stake.