FOR IMMEDIATE RELEASE
September 23, 2009
 

WASHINGTON—AARP Executive Vice President Nancy LeaMond issued this statement applauding the introduction of the “Medicare Premium Fairness Act” (H.R. 3631):

“As health care costs continue to soar despite lower inflation throughout the economy, older Americans are hit particularly hard. Retirees have seen their savings wiped away by market losses while their health care bills continue to climb. People in Medicare today spend nearly a third of their income on health care. The lack of a cost-of-living update in Social Security means that millions more in Medicare could see their health care costs rise further out of reach.

“AARP applauds Chairman Rangel, Chairman Stark, Rep. Titus, Chairman Waxman, Chairman Emeritus Dingell and Chairman Pallone for introducing this important legislation. By holding Medicare premiums steady for all beneficiaries for the next year—premiums that have doubled since 2000—their bill would help ensure that health care is more affordable for people in Medicare—without burdening taxpayers or future generations with new spending.

“We urge every House member who worries about the health and economic security of their constituents in Medicare to support this legislation when it reaches the floor tomorrow.”

There's been a lot of confusion about what's involved in health care reform, and even more confusion about who is supporting what. At AARP, our core goal remains the same. We are fighting for our members today, just as we've fought for them for the last 50 years. Today, that means we're fighting to protect the Medicare benefits you’ve earned. We're fighting to guarantee that you’ll never be denied coverage because of your health or age. We're fighting to prevent anyone from coming between you and your doctor. And we're fighting to make sure patients don’t take a backseat to insurance companies.

FOR IMMEDIATE RELEASE

September 22, 2009

WASHINGTON—AARP Executive Vice President Nancy LeaMond released this statement following the beginning of markup of health care reform legislation in the Senate Finance Committee:

“AARP applauds the work of Senator Max Baucus (D-MT) and the Senate Finance Committee as they continue to shape and strengthen health care reform legislation. This is an important step towards helping the millions of Americans who face spiraling health care costs and lack access to quality, affordable health care. We urge the Senate Finance Committee to strengthen and move this bill forward in order to enact comprehensive health reform this year to control skyrocketing costs, improve quality and give all Americans access to affordable, quality coverage.

“The legislation under debate includes several key health reform provisions that AARP has been fighting for, including prohibiting insurers from discriminating based on health status or pre-existing conditions, strengthening Medicare by improving quality of care and cutting out fraud and abuse and substantially filling the so-called ‘doughnut hole’ for prescription drugs.”

In a letter sent to Chairman Baucus (available here), AARP articulated pieces of the legislation it supports, amendments to the legislation it hopes are adopted and some provisions it is working to strike from the package. Specifically, AARP supports amendments which include:

* Placing a 2-1 limit on age rating;
* Ensuring that insurance premiums cannot exceed 10 percent of income; and
* Closing the doughnut hole for prescription drug coverage.

However, AARP is working to tackle omissions that must be addressed as this legislation moves forward, including:

* Inadequate subsidies, which could impact the ability of millions of Americans to afford coverage;
* No provisions to help low-income Medicare enrollees; and
* Insufficient provisions to expand access to and strengthen home and community-based services (HCBS) to help people live independently.


LeaMond added, “As the debate over health care reform continues, AARP will continue to work with Congress to ensure that any reform legislation makes coverage available and affordable for more Americans and improves quality of care. We urge the Senate Finance Committee continue their hard work and make health care reform a reality.”
 

Anticipated No Increase To Hit Nation’s Most Vulnerable The Hardest

Washington, DC – On the heels of AARP Public Policy Institute’s Solutions Forum addressing the lack of a Social Security COLA for 2010, AARP released the following statistics today which highlight the impact of the economic recession on Social Security recipients. Data shows that medical prices have risen during 2009, and Medicare beneficiaries with higher than average health care costs are hardest hit by not having a COLA next year.

Higher Medicare deductibles and premiums for Part D prescription drug coverage will be announced soon, adding to the health care cost burden. Moreover, because Medicare Part B and Part D prescription drug premiums are often deducted from Social Security checks, millions of Social Security recipients could see their benefit checks reduced in 2010, while they are still suffering from reduced retirement savings and a stagnant housing and employment market.

“Seniors face rising costs, but today have fewer resources to pay for them,” John Rother, AARP’s Executive Vice President for Public Policy and Strategy, said. “We urge Congress to address this issue quickly, so that seniors will not face reductions in their Social Security checks, or at least be compensated for increasing medical costs so vital to their well being.”

As advocates for older Americans examine the potential impact of a first-time no COLA for Social Security recipients, AARP has raised specific concerns regarding the rising costs of health care and significant losses in retirement savings.

AARP has compiled the following data to further the discussion taking place among advocates and lawmakers:


Stimulus

As part of the 2009 economic stimulus package, workers received a tax credit of up to $400 ($800 for couples), for 2009 and 2010. Social Security beneficiaries (and certain other retirees and disabled persons) received a one-time payment of $250 for 2009 only.

In addition, older households are more likely than younger households to spend any additional income that they receive, and this spurs economic recovery. (Source: Did the 2008 Tax Rebates Stimulate Spending? Matthew D. Shapiro and Joel Slemrod, University of Michigan and NBER, December 27, 2008.)


Retirement Savings

While the economy is recovering, household net worth is still about 17 percent lower than it was at the end of 2007 (and nearly 20 percent lower in inflation-adjusted terms). (Source, AARP Public Policy Institute calculations from Federal Reserve Board, Flow of Funds Account, Balance Sheet of Households and Nonprofit Organizations, September 17, 2009.)

Interest rates paid on savings account deposits have now also dropped to very low levels, leaving even conservative savers in a pinch. The average annual interest rate on a 6-month CD is less than half a percent today (0.44 percent in August 2009), down from 4.85 percent at the end of 2007. (Source: Federal Reserve Statistical Release H.15, September 21, 2009.)


Employment

Many older workers now plan to work longer in order to rebuild their retirement savings in the wake of the recession. But some have already lost employment, and many will be unable to continue working. When older workers lose their jobs, it takes them longer to find a new one, and some of them instead opt to drop out of the labor force altogether, turning to Social Security and retirement savings.

Social Security claims are on the rise as the souring employment market forces older Americans out of the workforce and diminishes their personal savings. The number of applications for retirement benefits was nearly 9 percent greater than expected this fiscal year to date. (Source: Stephen C. Goss, Chief Actuary, Social Security Administration, May 28, 2009. Data are for October 2008 through May 2009.)

In August, the average duration of unemployment was over 30 weeks for jobseekers aged 55 and older, compared to about 20 weeks in December 2007 and 24 weeks for jobseekers under age 55. (Source: Sara Rix, AARP Public Policy Institute, analysis of data from the U.S. Department of Labor, Bureau of Labor Statistics. See in particular The Employment Situation: August 2009; tables in BLS’s Employment and Earnings, January 2008 and September 2009; and BLS’s Labor Force Statistics from the Current Population Survey.)

As Federal Reserve Chairman Ben Bernanke has explained, while the economy is expected to grow in the coming year, “the economic recovery is likely to be relatively slow at first, with unemployment declining only gradually from high levels.” Thus, increasing numbers of older Americans will rely on Social Security because they can’t find a job for some time to come. (Source: Chairman Ben S. Bernanke, remarks delivered at the Federal Reserve Bank of Kansas City's Annual Economic Symposium, August 21, 2009 and at the Brookings Institution, on September 15, 2009.)

Medical Costs

While overall inflation is low (or negative), medical costs continue to rise; and, older Americans spend more than others on health care.

Between August 2008 and August 2009 the cost of all goods and services other than medical care fell by 1.8 percent. In contrast, the cost of medical care rose by 3.3 percent. (Source: Bureau of Labor Statistics, Consumer Price Index Summary, September 16, 2009, Table 1.)

Rising medical costs can be a disaster for retirees or anyone with unusually large expenses. On average, Medicare beneficiaries spend about 30 percent of their incomes on out-of-pocket medical expenses. (Source: AARP Public Policy Institute.)


To watch the webcast of the September 21st AARP Public Policy Institute’s Solutions Forum on the Social Security COLA, go to www.nextgenweb.org/aarp.
 

FOR IMMEDIATE RELEASE
September 14, 2009

New AARP Survey Shows Support For Increased Consumer Protections in Financial Industry

Washington, DC – AARP Executive Vice President, Nancy LeaMond released the following statement in response to President Obama’s speech today on Wall Street:

“Older Americans saw their retirement savings decimated by the economic crisis. AARP has long maintained that consumers must be armed with as much information as possible so that they can make sound financial decisions. In a world where individuals must plan for their own financial futures, information is imperative and greater protections are needed in the marketplace.

“AARP supports the creation of a Consumer Financial Protection Agency that would advocate on behalf of consumers’ needs in the financial marketplace. It is important that individuals know they are buying products and getting financial advice from industry certified advisors. It is important that when individuals buy a product that has been recommended to them it is the right product for their needs.

“In a recent AARP survey, 95 percent of people 25 years and older believe in having investment services firms increase their transparency around the costs, risks and benefits of all financial products they offer. The same number of individuals believe companies that manage 401(k) plans should be required to clearly explain their fees on participant’s annual statements. AARP has long advocated for transparency in 401(k) plans, having known that the majority of investors are unaware of the fees associated with their retirement savings.

“Similarly strong support exists for providing consumers with information on how to monitor their investment advisors and report possible professional misconduct (89 percent), and allow them to check their investment advisor’s record (93 percent). Finally, 69 percent believe in only permitting investment firms to sell products that are suitable for the needs, objectives, and risk tolerance of their consumers.

“AARP looks forward to working with Congress and the Administration to protect consumer’s financial well-being and to improve the economic security of American families.”

For more information about the aforementioned survey, contact Alejandra Owens at 202-434-2560 or asowens@aarp.org.

AARP Public Policy Institute Examines How to Make Your Nest Egg Last a Lifetime

Washington, DC – As increasing numbers of Americans consider retirement, many are not only worried about saving enough, but how to make their savings last throughout retirement. Today, AARP releases two documents examining and challenging the rules of thumb when it comes to planning for retirement.

Today’s retirees face a market downturn, falling home values and diminishing retirement savings which forces many to answer tough questions like: When should I claim Social Security? Should I get an annuity? What should I do with my home or mortgage? The rules of thumb no longer apply.

“When most individuals think of retirement, they think about how to save enough money,” said Jean Setzfand, AARP Director of Financial Security. “We have not spent nearly enough time discussing the best ways to take that money and turn it into an income stream that lasts throughout retirement. Our tip sheet challenges conventional thinking and offers general guidance about how to make the best decision for you and your circumstances.”

The AARP tip sheet, “Money Matters: Spending Down Your Assets in Retirement” (link below) addresses key questions like the ones above regarding planning for retirement and walks individuals through key actions steps – including resources and general guidance depending on an individual’s situation.

“Conventional wisdom may not be right for everyone,” said Janet McCubbin, who heads economic research at AARP’s Public Policy Institute. “More and more retirees today have to manage their own assets—instead of just cashing a pension check—and that’s not easy. A look at what experts have discovered can serve as a practical guide.”

AARP today released a second report, “Making Your Nest Egg Last a Lifetime,” that takes a fresh look at common financial decisions in retirement planning. The report was written for AARP by Anthony Webb of the Center for Retirement Research at Boston College.

To find the Money Matters tip sheet visit http://assets.aarp.org/www.aarp.org_/articles/money/financial_pdfs/spend_down_retirement_2009.pdf or for more information about the AARP Public Policy Institute’s examination of retirement planning visit http://assets.aarp.org/rgcenter/ppi/econ-sec/i32.pdf.

FOR IMMEDIATE RELEASE
August 27, 2009


WASHINGTON—AARP Executive Vice President John Rother released this statement in response to today’s report by the Department of Health and Human Services, “America’s Seniors and Health Insurance Reform: Protecting Coverage and Strengthening Medicare.”

“Older Americans are keenly aware of the high cost and inefficiencies of our current health care system. As today’s report notes, a couple today needs to save $300,000 just to cover their health care bills in retirement.

“Too often, people age 50 to 64 find themselves unable to purchase affordable insurance because of a preexisting condition, or simply because of their age, making them the fastest growing group of uninsured Americans. And each year, millions of people in Medicare fall into the doughnut hole—a costly gap in their prescription drug coverage—or struggle to find a doctor willing to take new Medicare patients.

“Health care proposals pending in Congress would guarantee every American has a choice of affordable, dependable health coverage, close the Medicare doughnut hole, pay doctors in Medicare fairly and take major steps to combat the skyrocketing costs of health care.

“We look forward to working with the Administration in the coming weeks to create a health care system that strengthens Medicare, protects patients and makes insurance fair for everyone.”

 

What if you already have health insurance through your employer? What does health care reform have to offer YOU?  This isn't about "other" people.  It's about you and your family.  It's about your future. 

Watch this short video clip from AARP's John Rother to learn how health care reform could impact you.

http://www.youtube.com/watch?v=K0B6yQNH148