Alliance for Retired Americans Friday Alert, October 7, 2011

Washington, DC–(ENEWSPF)–October 7, 2011.  

Super Committee Could Cut Social Security COLAs with “Chained CPI” Change

According to multiple sources, Members of Congress on the Super Committee charged with reducing the nation’s budget deficit are considering changing the formula that determines the Cost of Living Adjustment (COLA) for future Social Security recipients.  Social Security’s COLAs for monthly benefits are designed to help retirees keep up with rising living standards and costs. COLAs currently are tied to the Consumer Price Index for Urban Wage Earners (CPI-W), which surveys price changes in the average set of goods purchased by urban wage earners and clerical workers. There has been no COLA in the past two years. The CPI-W formula does not protect seniors’ purchasing power because it fails to account for the fact that seniors spend two to three times as much of their budget on medical care than younger households. Yet, many in Congress are seriously considering cutting Social Security benefits by now tying the COLA to the Chained CPI (C-CPI-U), an even smaller measure of inflation. While many will falsely describe this change as simply technical, it is a change that would result in big lifetime losses in benefits for the average Social Security beneficiary.

According to Social Security Works, an average earner retiring in 2011 at age 65 would lose over $6,000 over 15 years if the chained CPI were adopted today. The chained CPI assumes that a lower COLA is acceptable because consumers can substitute cheaper products when prices go up. The problem is that health care costs, which consume a large amount of seniors’ income, cannot simply be substituted with a cheaper version. A senior cannot just substitute triple bypass surgery with a double because it’s cheaper. Nor can knee surgery be substituted with crutches. The Alliance has a new web page focused exclusively on the Super Committee. It contains a petition that visitors can sign to tell the Super Committee, “Don’t cut Medicare, Medicaid or Social Security benefits!” Click on to view the page. Please sign the petition at

Mitt Romney on Social Security: Increase the Retirement Age!

When GOP presidential candidate Mitt Romney spoke on Tuesday at the retirement center in Central Florida known as the Villages, he attacked his fellow GOP contender, Texas Governor Rick Perry, on Social Security. “I don’t think the major problem is Social Security as a Ponzi scheme. I think the problem is keeping it from becoming a Perry scheme,” said Romney. However, Romney himself favors not only cutting the Social Security COLA, but also raising the retirement age. He had told a New Hampshire audience just that on Monday. “We can’t let Romney’s attacks on Rick Perry’s Social Security stance deflect attention away from how bad his own positions are,” said Barbara J. Easterling, President of the Alliance.

Alliance Rallies at U.S. Capitol for “Jobs – Not Budget Cuts”

Alliance member Brenda Kelley Nelum of Woodbridge, Virginia spoke on Wednesday at the rally at the U.S. Capitol, where activists told Congress to stop the job-killing budget cuts and take bold action to put Americans back to work. Many of the protesters at the event were part of the anti-Wall Street movement that began recently in New York City. “I am honored to be here today with so many people who understand that it’s time for Congress to ACT to create jobs and get America’s economy moving again. And that it’s CERTAINLY NOT the time to cut our most meaningful programs like Social Security and Medicare!” said Ms. Kelley Nelum. She also got the crowd chanting “Senior Power.” On Wednesday in New York City, Alliance and union members joined the “Occupy Wall Street” protesters for a march and rally to hold Wall Street accountable and create good jobs, drawing several thousand.

Millions of People Using Free Preventive Benefits Provided by Affordable Care Act

The Centers for Medicare & Medicaid Services (CMS) reported yesterday that nearly 20.5 million people with Medicare reviewed their health status at a free Annual Wellness Visit or received other preventive services with no deductible or cost sharing this year.  In addition, nearly 1.8 million people with Medicare received discounts on brand-name drugs in the Medicare Part D coverage gap, also known as the “doughnut hole,” between January and August of 2011.  The total value of discounts to people with Medicare in the doughnut hole is nearly $1 billion through August of this year, with an average savings of $530 per beneficiary. Free preventive services available to people with Medicare include mammograms and cervical cancer screenings; an annual Wellness Visit; cholesterol and other cardiovascular screenings; and colorectal and prostate cancer screenings.

The rising number of people who are taking advantage of preventive benefits and prescription drug discounts comes as people with Medicare are beginning to review their plan options for next year. The annual enrollment period begins earlier this year than last year, on October 15, and runs through December 7.  People with Medicare will have seven weeks to review Medicare Advantage and Part D prescription drug coverage benefits and plan options, and choose the option that best meets their unique needs, or keep the plan they have today. To access the Medicare Plan Finder, go to: “The Affordable Care Act has helped millions of people undergo preventive screenings and afford their prescription drugs more easily,” said Ruben Burks, Secretary-Treasurer of the Alliance.

State Round-up: Arizona and North Carolina

Last Thursday, the Arizona Alliance held its bi-annual convention in Phoenix. Rep. Raul Grijalva gave an impassioned speech about his commitment to protecting Medicare, Social Security, and Medicaid. The following 2011-2013 board officers were elected: Doug Hart, President; John Campbell, 1st Vice President; Bill Engler, 2nd Vice President; Roman Ulman, Treasurer; and Tino Torres, Recording Secretary. Union Vice Presidents are Dan Pollard, Julian Natividad, Saundra Cole, Chuck Yarter, and Henry Telfer. Community Vice Presidents are Sandra Krause, Gary Mehok, Kathy Lehman, Wayne Burrow, and Vikki Marshall.

On Thursday in Raleigh, the North Carolina Alliance held a meeting kicking off the North Carolina Elder Economic Security Initiative. Through a combination of advocacy, research and education at the community, state and national levels, the initiative seeks to enhance economic security and financial self-sufficiency for our nation’s elders. The initiative is a component of a multi-year national project of the group Wider Opportunities for Women (WOW). The NC Alliance also presented the Raleigh Food Bank with 14 boxed lunches for those in need at the event.