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Online Chat: The Future of Medicare and Social Security

Missed the May 23 conversation? Read the transcript

This transcript has been edited for clarity.

AARP: We know you care about the future of Medicare and Social Security. After all, you’ve worked your whole life and these are your hard-earned benefits. But if you're anything like us, you probably have a lot of questions about the future of these programs. What are the challenges ahead for Medicare and Social Security? What proposals are politicians in Washington considering? We’re very lucky to have David Certner, AARP’s legislative policy director, with us today to answer your questions.

David Certner, AARP: Hi, everyone. I’m glad to be here today. You can ask a question below or Tweet your question using the hashtag #askYEAS. Let’s get started!

Comment from Jane M: How secure is our Social Security?

David Certner, AARP: The latest report from the Social Security Trustees — who each year make a 75-year projection for Social Security — states that Social Security can pay full benefits until 2033, and then it can pay about 75 percent of currently promised benefits beyond that time. The sooner we can act to address the long-term shortfall, however, the more modest the adjustments we will need to make, and the longer the time to phase in any changes so people can properly plan. Thanks for the good first question!

Comment from Conne Novak: How can information be given out that Medicare is not free? We paid into it all of our working years and I still pay a monthly fee. I ask this because a young woman asked if I was retired and I said yes. She proceeded to say, "Oh, you don't have to worry about medical insurance because you have free Medicare." I told her that to meet my expenses I carry a supplemental plan. She then said, "You must have made a lot of money." I explained I ended my career in 2008 at a little over $41,000 a year and live on a very careful budget. How do we stop this thinking that seniors get Medicare for nothing?

David Certner, AARP: Thanks, Conne. You raise an excellent point, and it is one that we are trying to reinforce with all of our materials and communications. The typical Medicare beneficiary has income of just over $20,000 per year. Most people don’t realize that Medicare only covers about half of a senior’s medical costs, and that roughly 20 percent of their income goes to health care costs, including premiums, co-payments and deductibles. And as you note, that’s in addition to the contributions seniors have made to the Medicare program throughout their working years.

Comment from Reine: I would like to know if Medicare and Social Security are going to be better in the years to come, and what are they debating about in Washington to help elders with reducing the cost of prescription medications?

David Certner, AARP: Social Security and Medicare both face challenges in the future, primarily because of demographics (more people over age 65), and in the case of Medicare, high health care costs. But it’s important to address these challenges to ensure that Social Security and Medicare will continue to provide health and financial security. Part of the debate today is how to address these challenges. It’s important to make the best decisions today to strengthen these two critical programs for the future. Our effort this year is to hear from all of you about the various options that have been discussed.

Comment from Susan Taylor: Why hasn't any administration been forced to pay back the money taken out of the Social Security account to make their budgets seem smaller? All they've left behind are IOUs. How come they have never been paid back?

David Certner, AARP: Susan, we hear this issue come up all the time. The Social Security trust funds hold about $2.7 trillion dollars of Treasury bonds — some call them IOUs, but most consider them the safest investment in the world. The bonds pay about 4.5 percent interest to Social Security, and similar to any Treasury bondholder, we expect that the government will continue to honor all the bonds and interest income owed to Social Security. The problem is that the rest of the government has run up large debt, making it more difficult to repay all bondholders, including Social Security. However, we agree Social Security must be paid back and that Social Security should not be cut in order to address the deficit in the rest of the federal budget.

Next: Is Medicare solvency dependent upon health care costs? »

Comment from Kim K: Is making Medicare solvent dependent upon controlling health care costs in general?

David Certner, AARP: Excellent point. Medicare is just one part of the health care system, and the high cost of health care also drives higher costs in Medicare. We need to hold down costs across our inefficient health care system to best hold down costs in Medicare.

Comment from Dan Johnson: It seems to me that a sensible approach to fund Social Security for the future would be to increase the maximum taxable income for Social Security purposes to somewhere around $180,000, as advocated by Robert Reich [secretary of Labor under President Bill Clinton]. What measures does AARP advocate as a means to ensure the long-term health of both SS and Medicare?

David Certner, AARP: Thanks, Dan. While AARP has many principles and positions on issues, our You’ve Earned a Say initiative this year is based on providing information about the options that are being discussed in Washington and getting feedback from our members and other Americans. We believe you have contributed to these programs throughout your working life, and you deserve to be heard. As to your suggestion, there are several proposals on the table in Washington to raise the payroll tax cap or eliminate it altogether as a way of helping to fund Social Security in the future. Right now, as you may know, the Social Security payroll tax is applied to the first $110,100 of earnings, or 84 percent of all covered wages. Raising the cap back to its previous level of 90 percent of wages (similar to your suggestion) is estimated to fill about one-third of the future funding gap. If all earnings were immediately subject to the Social Security tax, the new revenue would fill most of the funding gap. For more information about this and other proposals on the table in Washington, check out the June 2012 issue of the AARP Bulletin.

Comment from Ronald Young: Are future changes in Social Security going to affect present recipients?

David Certner, AARP: Most of the changes that are being discussed would be phased in over time, but there are some proposed changes that would impact current seniors. In particular, some would change the calculation of the Social Security cost-of-living adjustment (COLA) so the COLA would be lower every year. This is sometimes referred to as moving to a "chained CPI" — a new way of calculating the COLA that would affect current beneficiaries.

Comment from Elizabeth Borg: Is the COLA Social Security gives out (at least this year) based on the total income of the receiver or the amount received per month from Social Security. Or is it something else?

David Certner, AARP: Social Security’s annual cost of living adjustment — or COLA — is based on the increase in the consumer price index (CPI), a calculation of price increases on goods and services throughout the economy. The benefit amount that each individual receives is increased by the CPI. Recently, there were two years with no COLA because, given the recession, the CPI did not increase.

Comment from Meta Kirby: I want to know why the fraud in Medicare and Medicaid has not been more effectively enforced? There is a ton of money there we could use to help shore up Medicare and Medicaid if they would just go after the fraud. I know they are starting to do that in Houston. However, when I sent a letter to Medicare three years ago giving them names, companies, etc., of people who were committing fraud, to this date (after two more letters), Medicare has not even bothered to reply! I know they got them because they were sent certified, and I received the green cards back.

David Certner, AARP: Thanks, Meta, for raising this question. We agree that fraud in the health care system continues to be a problem, and that is true for the Medicare and Medicaid programs as well. Recently, the law was changed to provide more tools to fight fraud, and there is other legislation pending. Medicare is also becoming more aggressive in fighting fraud, which costs both individuals and the government more money, recovering over $4 billion in 2011. I applaud you for joining the fight to stop Medicare fraud, and we can all help in this effort. For more information, you can go to, or participate in our free webinar on June 12 ( You can also report Medicare fraud by calling 1-800-MEDICARE. In addition, the Senior Medicare Patrol can help, as can the Medicare & Medicaid Services website for fraud and abuse.

Next:  When is it best to start taking benefits. »

Comment from J. Ferrell: Experts disagree on when to start taking benefits. What is your opinion?

David Certner, AARP: When to best take Social Security often depends on your personal circumstances. Generally, the earlier you take your benefits, the greater the actuarial reduction. So if you can wait to take your benefits, they’ll be higher for the rest of your lifetime. The AARP Social Security Calculator will help estimate your Social Security benefits and show you the best time to claim Social Security.

Comment from Carol Singleton: Why can't Medicare negotiate with drug companies to lower prices on drugs to seniors? Even Canada's prices are lower than ours, on the same products. Not fair!!

David Certner, AARP: Carol, we agree that Medicare should have the power to negotiate for lower drug costs. This is especially needed where there is no competition for the brand-name drug. The United States pays the highest drug prices in the world. AARP has supported legislation to allow for the safe importation of lower-priced drugs from Canada and other nations. Doing this would increase competition and lead to lower prices in our country.

Comment from Michael Podufaly: Is there any truth to the rumor that the Medicare Part B premium will double in the next two years without Social Security doubling also?

David Certner, AARP: No. As you may know, the standard Part B premiums — now $99 per month — generally increase every year with the increase in total Part B costs. While we expect the premiums to go up annually, they are generally expected to increase at a few dollars per month, as they have done in the past.

Comment from Kitty Ruderman: Can we prevent Congress from making their threatened cuts to Medicare? We need this program intact.

David Certner, AARP: We agree that Medicare is critical to the health security of older Americans. During the past two years there have been a number of options on the table in budget discussions to reduce Medicare benefits. As part of AARP’s You’ve Earned A Say initiative, we will be working to make sure that people are aware of some of the lead options, as well as provide the pros and cons of different approaches to Medicare changes. We think it’s important that the Congress and the president hear from people like you what these changes may mean to your health security and that of your family. As part of You've Earned a Say, we will be putting out the leading options that have been discussed in Washington — including the pros and cons of each of the options by outside experts who represent different points of view. You can find them online, about both Medicare and Social Security.

Comment from Wendy [via Twitter]: What’s the chance Medicare will collapse within 10 years?

David Certner, AARP: Thanks for the Twitter question. (Remember, you can tweet us a question using the hashtag #askYEAS.) Medicare is but one part of our nation’s health care system that is both costly and inefficient. It is fundamentally important that in order to help Medicare, we first address problems in our entire health care system. Medicare also faces long-term funding challenges, particularly as the number of seniors increase and as health care costs continue to rise faster than inflation. But Medicare is too important to the health care of older Americans to simply “collapse.” Part of the debate we are having today is about what changes we can make to our health care system, as well as what adjustments we can make to Medicare in order to ensure it’s strong for the future and includes changes such as better care coordination, better use of health information technology, and better efforts to weed out waste and fraud. For up-to-date information about what’s happening, please follow me on twitter at @DavidCertner.

Comment from David: Where was AARP on the payroll tax issue?

David Certner, AARP: As you may know, to help stimulate the economy during the past two years, a 2 percent reduction in the Social Security payroll tax was temporarily enacted. AARP insisted that Social Security’s funding be made whole, which it has been. We have now clearly stated that in order to protect Social Security for the future, the temporary tax break should expire.

Next: Is AARP endorsing Obama or Romney in election 2012? »

Comment from Bill: Is AARP supporting Obama or Romney in the presidential race?

David Certner, AARP: Thank you for your question. As you may or may not know, AARP is nonpartisan. We do not endorse candidates for office, we do not have a PAC and we do not give money to candidates or political parties. Our goal is to work with all elected officials on behalf of older Americans, regardless of party. This fall we will be putting out a Voters' Guide with comments on key issues in the candidates' own words.

Comment from Renee G: How will our comments on how to strengthen Medicare and Social Security be used?

David Certner, AARP: Through the You’ve Earned a Say initiative, AARP is providing members a variety of ways to make their voices heard, such as through town hall meetings, surveys, questionnaires, videos, online chats and bus tours. Results of the questionnaires and member comments will be compiled into reports we’ll provide to Congress and federal candidates this fall.

Comment from James F. Frazee: I will count on AARP to do the right thing in Washington!!!

David Certner, AARP: Throughout its history, AARP has been fighting to protect Social Security and Medicare. Hopefully that is a vote of confidence. Rest assured that AARP will continue to fight to protect the retirement security of older Americans. But we need your help and involvement. The actions of millions of Americans spur our efforts. So thank you for joining us today.

AARP: Well, we’ve reached the end of our hour. Thank you, David, for being with us today! We appreciate all the helpful information you provided. And a huge THANK YOU to everyone who took the time to submit a question or participate in today’s chat! If you didn’t get your question answered, don’t worry. We’re planning to answer more questions every week through a new “mailbag” feature on So keep an eye out! AARP will keep working to protect and strengthen Medicare and Social Security for today’s seniors and generations to come.

If you haven’t done so yet, we encourage you to take our questionnaire at and express your opinion on the future of these vital programs. Together, we can take the debate out from behind closed doors in Washington. Thank you again. Bye, everyone!

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