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Medicare Part B premium hike will be smaller than expected

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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

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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.

How cuts to Social Security Administration will hurt you

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Undated handout photo. REUTERS/ICE/Handout  “Starving the beast” is a favorite conservative strategy for forcing cuts in federal spending. The idea is to deprive the government of revenue in order to force spending cuts – and resistance to new taxes is a central feature of the current Super Committee deliberations in Washington.

Advocates for older Americans are watching closely to see how the committee’s work might lead to retirement benefit cuts via a higher Social Security retirement age, smaller cost-of-living adjustments or higher Medicare eligibility ages. Meanwhile, a separate starve-the-beast exercise goes mostly unnoticed: a big squeeze on the administrative budget of the Social Security Administration (SSA).

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

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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.

Here’s the real Social Security Ponzi scheme

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Gov. Rick Perry wants to have a conversation about means-testing entitlements. This is a softer, gentler version of the governor’s earlier assertions that Social Security is an un-Constitutional Ponzi scheme.

And Perry is hardly the only conservative floating the idea that wealthy seniors should get less Social Security — or none at all.

Should rich people pay more for Medicare?

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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.

Perry’s monstrous lies about Social Security

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Gov. Rick Perry, the GOP presidential candidate who calls Social Security a “monstrous lie” and a “Ponzi scheme” has implied that future retirees can’t rely upon receiving benefits from the system.

Not only is Perry shooting wildly from the hip on these statements — a strategy cynically designed to attract angry, younger independent voters — he’s spewing some layered falsehoods that need to be addressed.

Would Obama’s payroll tax cut hurt Social Security?

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The Congressional Super Committee hasn’t even started cutting Social Security, but advocates are already expressing concern on a different front: the payroll tax cut extension proposed last night by President Obama as part of his jobs plan. Those payroll taxes fund the Social Security program.

The President asked for a $175 billion one-year extension and expansion of the employee payroll tax holiday now in place, halving the tax rate to 3.1 percent in 2012. He also proposed halving employer payroll taxes to 3.1 percent for the first $5 million of payrolls in 2012. The president also wants a complete payroll tax holiday that would apply when companies grew their payrolls by up to $50 million in a year by hiring  new workers or raising the salaries of existing workers.

5 easy pieces of Social Security advice, information and trivia

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Why has Congress raised the Social Security full retirement age but not the early age? Why don’t we fix Social Security’s finances by cutting administrative overhead? Why do Social Security numbers have nine numbers and what do the numbers mean? Who got the first Social Security card?

I get a constant stream of questions about Social Security — no surprise, since benefits are the most important source of income for most retirees. In fact, new data from the Social Security Administration shows benefits accounted for 38 percent of total income for Americans over age 65 and older in 2009 — up from 30 percent in 1962.

Why 401(k) plans will fall short for most Americans

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It’s time to end the fraudulent notion that 401(k)-type plans are adequate retirement vehicles for most Americans.

They fall short in so many ways, but mostly because they’re too expensive, are exposed to excessive unhedged market risk, poor allocation and contain no income guarantees. There is a better way: Congress can fix the problem while boosting private investment.