Medicare Premiums Soar 93 Percent Since 2001, Five Times Faster Than Annual
Social Security Cost of Living Adjustment
WASHINGTON, Oct. 1 /PRNewswire-USNewswire/ -- Earlier today, the Centers for Medicare and Medicaid Services (CMS) announced that Medicare Part B premiums would increase by 3.1 percent next year, to a total of $96.40 per month per senior. Excluded from their announcement is the fact that premiums have jumped 93 percent since 2001, when premiums were just $50.00 per month.
Part B premiums are rising almost five times faster than the annual Social Security Cost of Living Adjustment (COLA) seniors receive each year, which is intended to help them keep up with rising costs. While Medicare Part B premiums will have soared by more than 93 percent from 2001 - 2008, the COLA will have crept up by just 19 percent (See Note 1) during the same period.
Medicare Part B covers doctors' visits, tests, and outpatient hospital care.
A majority of the 48 million Americans aged 65 and over who receive a Social Security check depend on it for at least 50 percent of their total income, and one in three beneficiaries rely on it for 90 percent or more of their total income. But because the Social Security COLA will be completely eaten up for millions of low income seniors due to increasing Medicare premiums, the nation's elderly will see their spending power diminish again next year, as it has for several straight years.
"Many people have the mistaken notion that such a low Medicare premium increase is good news for seniors -- but they forget that it's been rising five times faster than their Social Security checks," said Shannon Benton, executive director of The Senior Citizens League. "Medical expenses alone are leaving seniors to fend for themselves with all other rising costs -- such as gasoline, home heating, and groceries."
To help offset the cost of Medicare Part B, The Senior Citizens League is lobbying for a change in the Consumer Price Index (CPI) used to determine the COLA. The government currently calculates the COLA based on the CPI for Urban Wage Earners and Clerical Workers (CPI-W), a slow-rising index that tracks the spending habits of younger workers who don't spend as much of their income on health expenditures.
However, the government does track the spending patterns of older Americans, and has done so since 1983 with the CPI for Elderly Consumers, or CPI-E. By tying the annual increase in the COLA to the CPI-E, seniors would see much needed relief in their monthly checks.
For example, a senior who retired with a benefit of $460 in 1984 would have received almost $10,300 more over the past 23 years with the CPI-E.
TSCL supports two similar bills entitled "The Consumer Price Index for Elderly Consumers," introduced in the current Congress. H.R. 1953 was introduced by Representatives Charles Gonzalez (R-TX) and Robert Wexler (D- FL), and H.R. 2032 was introduced by Representative Peter DeFazio (D-OR).
With 1.2 million supporters, The Senior Citizens League is one of the nation's largest nonpartisan seniors groups. TSCL is a proud affiliate of The Retired Enlisted Association. Visit http://www.SeniorsLeague.org for more information.
Note 1: This figure assumes a 2.5% COLA increase for 2008, "Budget and Economic Update," Congressional Budget Office, August 23, 2007
|SOURCE The Senior Citizens League|
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