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Medicare Part B premium hike will be smaller than expected


Seniors caught a break Thursday when the Obama Administration announced that Medicare Part B premiums won’t rise as much as expected in 2012.

The premium for Part B – which funds doctor and other outpatient services – will be $99.90 in 2012, up just 3 percent compared with this year. And the Medicare Part B deductible will be $140, a decrease of $22 from 2011.

The official government 2012 Part B premium forecast had been $106.60 – an increase that would have taken a significant bite out of Social Security’s cost-of-living adjustment (COLA). Although Social Security beneficiaries will receive a 3.6 percent raise next year, the average beneficiary’s increase would have been shaved to 2.95 percent if the larger Part B increase had been implemented. Part B premiums are deducted from most seniors’ Social Security benefits.

Today’s news means that seniors receiving the average monthly Social Security benefit ($1,177) will see a net 3.3 percent gain in payments – just under $39 per month.

Retirement confidence falls, especially in Social Security: Poll


Talk about a race to the bottom: Which institution do you think is losing the trust of Americans to provide future retirement benefits most quickly – government, or private employers?

The winner is . . . private employers, but not by much. A new national poll on retirement sentiment by Sun Life Financial Inc. finds worker confidence in the future value of employer-provided benefits plunged 32 percent in the past year. Meanwhile, confidence in the government’s ability to provide Social Security and Medicare benefits fell 22 percent.

Medicare will cut Social Security’s “raise” in 2012


A girl tries to climb a snow-packed wall in a labyrinth at the Sapporo Snow Festival in Sapporo in northern Japan February 5, 2008.  REUTERS/Yuriko Nakao (JAPAN)After two years without an inflation adjustment, the Social Security Administration is expected to announce a 2012 cost-of-living adjustment (COLA) of more than 3 percent next week. That would be a sizable raise in this economy, and very welcome news to seniors hit hard by rising costs, slumping home equity and very low returns on fixed-income investments.

But the good COLA news will come with a nasty kicker. Many seniors will see a substantial part of the COLA consumed by a higher premium for Medicare Part B (doctor visits and outpatient services), which usually is deducted from Social Security payments. The situation sheds light on the complex interaction of Social Security COLAs and Medicare premiums — and it underscores the critical importance of the Super Committee deficit deliberations on possible cuts to future COLAs.

Some Medicare plans drop prices: time to shop is now


A nurse holds up a vial of H1N1 flu vaccine prior to an inoculation at the Geisinger Medical Center in Danville, Pennsylvania October 28, 2009. If you’re a senior on Medicare – or if you help out aging parents with their money matters  – it’s time to get ready to shop. The annual enrollment period for Medicare prescription drug and Advantage managed care plans is about to begin, and it’s one of the best opportunities of the year for seniors to save money.

The new healthcare reform law is reshaping certain parts of the Medicare marketplace, for the most part in ways that benefit seniors. Although the law gradually reduced subsidies to Medicare Advantage — a change that critics derided as “slashing” Medicare– the Advantage and prescription drug markets are doing just fine. The number of plan offerings for 2012 are stable and average prices are steady or falling slightly.

2012 Medicare choices come early: How not to overpay


Last year, Henry D’Aloisio needed to adjust his Medicare coverage to pay for doctor’s visits. He thought the changes would be simple, and that decades of administrative experience would have prepared him adequately for the paperwork and small print.

But it was much more time consuming and complex than he had been expecting — “the most daunting” task he’s faced in 50 years, he says.

Should rich people pay more for Medicare?


Should affluent seniors pay more for Medicare than everyone else? How about Social Security? Should we cut benefits for wealthy Americans?

Ideas for “means testing” these critical retirement programs are front and center as deficit reduction talks move back into high gear in Washington. Many Republicans are arguing that Social Security benefits should be cut for wealthy Americans — an idea also backed by the bi-partisan Simpson-Bowles deficit report. Meanwhile, President Obama proposed higher Medicare premiums for high-income seniors this week as part of the deficit plan he submitted to the Congressional Super Committee.

Why entitlement is not a four-letter word


“It’s a beautiful thing, the destruction of words,” wrote George Orwell in 1984. And so it is with a mangled word that is central to the 2012 presidential race and the work of the Congressional deficit-cutting Super Committee: entitlement.

In the context of federal programs such as Social Security and Medicare, the word entitlement refers to a benefit you are granted by law. You are entitled to the benefit not because it is welfare, but because it is a program you have paid into over time. You can count on it because it is insurance that isn’t subject to the judgment of a case worker or the spending priorities of budgetmakers.

8 ways the super committee is not super for retirement


social security super committeeSocial Security and Medicare will be in the sights of the Congressional “super committee” that will be looking for $1.5 trillion in federal spending cuts under the terms of the debt ceiling agreement. That means the financial security of seniors and Boomers nearing retirement will be on the line, so let’s consider the outlook for these vital programs as the negotiations get underway.

If the super committee can’t reach agreement — or if Congress rejects its recommendations — automatic spending cuts would be triggered, with Social Security, Medicare and Medicaid exempted. So a stalemate would mean status quo for the “big three” entitlement programs. But if the committee reaches agreement on a deal with no tax hikes or new revenues, all three programs could would face dramatic cuts. The committee must wrap up its work by November 23, and Congress would have until December 23 to vote.

Long-term care funding wrapped up in deficit debate


The following is a guest post by Brad Allen. The opinions expressed are his own.

The debate over funding long-term care has gotten renewed energy – but no greater clarity – from the current deficit reduction discussions roiling Washington.

Seventy percent of Americans over the age of 65 will need some level of long-term care in their lifetime with 20 percent requiring two to five years of care, according to the U.S. Dept. of Health and Human Services. Annual costs can vary widely, but the national average in 2008 ranged between $18,000 for part-time in-home health aides to $68,000 for a semi-private room in a nursing home.

Social Security, Medicare dodge bullet, but cuts loom


Social Security and Medicare dodged a bullet in the debt ceiling battle, but beneficiaries still have plenty to fear from the next phase of the deficit reduction war.

The agreement to raise the debt ceiling means seniors will receive their August Social Security benefits – something many worried about after President Obama said last month that he “couldn’t guarantee” the payments if default occurred. Likewise, Social Security and Medicare benefits both were exempted from the $917 billion in first-phase cuts that paved the way for the debt ceiling deal.