On September 6, Barack Obama and John McCain told the AARP what they would do to fix Social Security.

What is the problem with Social Security?

According to the Wall Street Journal, the problem is that there are fewer workers to support each retiree than there used to be, with the result that, "without changes, by 2041 the program will have depleted reserves that are, on paper, set aside for benefits."

It's alarming that 8 years after Al Gore brought attention to this issue -- by promising in the 2000 presidential election to put Social Security in a "lock box" -- that nothing has been done under the Bush administration to solve the problem.

Senator McCain and Senator Obama have starkly different views on how to fix Social Security.

Senator McCain has said that he might balance the Social Security "books" by allowing workers to “privatize” their benefits. "There may be a role for private investment accounts for younger workers as long as they are not a substitute for insuring the solvency of the system and does not affect the system," Sen. McCain said. This is the same privatization plan that President Bush proposed in 2005, which certainly validates Barack Obama's claim that McCain is Bush all over again.

But, don't take my word for it. The Wall Street Journal describes McCain's plan as being the same as Bush's:

“Under [McCain’s plan], pushed hard by President Bush in 2005, workers could divert some of the taxes that normally would go to pay Social Security benefits into personal accounts invested in stocks and/or bonds. In trade, their guaranteed checks from the government would go down, increasing both the possibility of risk and reward for participants, depending on how the investments fare.”

The Wall Street Journal says, “This could help balance the books long term because government obligations would drop.” But, because less money would be coming into the system also, if workers put their money in private accounts, one has to wonder how this would be a solution, even on paper.

From listening to what Senator McCain told the AARP, the only thing McCain promised to do on Social Security was to create a “bipartisan commission to propose solutions to extend the solvency of the federal retirement program.”

Appointing a commision is a great way to kill some time, and for Senator McCain to give himself some political cover for any politically unpopular solution that needs to be implemented. So the McCain "plan" for Social Security is in reality no plan at all.

Senator Obama, on the other hand, tells us what he would do to fix Social Security.

“Privatizing Social Security was a bad idea when George Bush proposed it, and it's a bad idea today. It would take the one rock-solid, guaranteed part of your retirement income and gamble it on the stock market. If all your Social Security money had been privatized in Lehman Brothers, AIG & Company, this week, you’d be wiped out"Obama told the AARP. Senator Obama’s remarks are even more meaningful now that our financial systems are close to breaking down, and stock values have plummeted.

The payroll deduction for Social Security taxes is currently capped at $102,000 in annual income - meaning income over $102,000 is exempt from the social security tax. Senator Obama points out that this means that `` middle-class families pay this tax on every dime they make, while millionaires and billionaires only pay it on a very small percentage of their income.”

Senator Obama said that he would raise more money for Social Security by, in 10 years time, lifting the cap on Social Security payroll taxes on those making $250,000 a year or more.

"I'll work with members of Congress from both parties to ask people making more than $250,000 a year to contribute a little bit more to keep the system sound," Sen. Obama said. "It's a change that would start a decade or more from now, and it won't burden middle-class families. In fact, 99% of Americans will see absolutely no change in their taxes."

Decide for yourself - listen to Obama and McCain at the AARP by clicking on these links: Barack Obama at AARP and John McCain at AARP.

Felicia Curran
www.ElderAdvocacyLaw.com

Unless you’re so wealthy that you can afford to pay for whatever medical costs life brings your way, you’re concerned about health care insurance, along with millions of other Americans.

Bob Herbert (pictured at right), a columnist for the New York Times, has just run an article on the John McCain health plan that I think you should read. It clearly summarizes the results of a study of the McCain health care plan by the non-partisan policy Journal of Health Affairs.

Bob Herbert writes,

“For starters, the McCain health plan would treat employer-paid health benefits as income that employees would have to pay taxes on."

"It means your employer is going to have to make an estimate on how much the employer is paying for health insurance on your behalf, and you are going to have to pay taxes on that money," said Sherry Glied, an economist who chairs the Department of Health Policy and Management at Columbia University's Mailman School of Public Health."

“Ms. Glied is one of the four scholars who have just completed an independent joint study of the plan. Their findings are being published on the Web site of the policy journal, Health Affairs."

“According to the Health Affairs study: 'The McCain plan will force millions of Americans into the weakest segment of the private insurance system — the nongroup market — where cost-sharing is high, covered services are limited and people will lose access to benefits they have now.'"

“The net effect of the plan, the study said, "almost certainly will be to increase family costs for medical care."

“Under the McCain plan (now the McCain-Palin plan) employees who continue to receive employer-paid health benefits would look at their pay stubs each week or each month and find that additional money had been withheld to cover the taxes on the value of their benefits."

“While there might be less money in the paycheck, that would not be anything to worry about, according to Senator McCain. That’s because the government would be offering all taxpayers a refundable tax credit — $2,500 for a single worker and $5,000 per family — to be used “to help pay for your health care.”

Here comes the counter-intuitive part: By taxing employer-paid health coverage, the study says that McCain’s goal is actually to “get families out of employer-paid health coverage and into the health insurance marketplace, where naked competition is supposed to take care of all ills.” In other words, you’ll be out of the frying pan and into the fire under the McCain plan.

Herbert continues, “We’re seeing in the Bear Stearns, Fannie Mae, Freddie Mac, Lehman Brothers and Merrill Lynch fiascos just how well the unfettered marketplace has been working.” I’ll say.

I’ve done the calculation in my own and my family’s case: Our insurance costs more than the value of the McCain tax credit, so we would wind up owing the government money in taxes if the McCain plan goes through. So to keep equivalent coverage, we would wind up paying more. And, if we decide to give up employer-paid health insurance, and move to non-group health insurance (this is the market where individuals and families who do not have employer- or government-sponsored coverage buy their insurance today), the Health Affairs article says that we would be likely to pay more for less insurance. Why? The Health Affairs study explains:

“ The reality is that providing coverage through nongroup plans is much more costly than providing that coverage through [employer]-groups . Administrative expenses are twice as high in nongroup markets as in group markets. The costs are higher because insurers in this market spend considerable resources on medical underwriting, and economies of scale are lost. It is much more expensive to sell insurance to millions of individuals one individual at a time than it is to sell to a much smaller number of employer groups, each comprising thousands of employees. For a typical family that moves from group to individual coverage, therefore, the move to nongroup insurance will raise premiums for an identical policy by more than $2,000 per year. Shifting people into the nongroup market would not save money for most Americans. Rather, it would lead to increased spending on administrative costs and a decrease in the portion of health spending that actually goes to providing care .”

In short, if your family has an employer-paid health insurance plan now, the McCain plan would mean that you’re paying $2,000 more a year for it than you are now (after the tax-rebate).

McCain says his philosophy is that "a bureaucrat shouldn't come between you and your doctor". He's right in one sense - under his plan, if you lose your health insurance, your doctor and hospital will be sending the bills directly to you, and not some bureaucrat, that’s for sure.

To read the Health Affairs article on McCain's health plan, click here.

To read Bob Herbert’s article, click here.

Felicia Curran
www.ElderAdvocacyLaw.com

Remember Sen. John Edwards’ day following a nurse’s aide in a nursing home? (See Elder Advocacy Blog, April 28, 2007). Recently, both Senator Hillary Clinton and Senator Barack Obama have taken their turn.



Sen. Clinton spent a day at an hospital with an R.N. in Las Vegas. Senator Obama spent a day with a home health aide here in Oakland, California.



Now, I know that people have poked fun at these "walk-a- day-in-my-shoes" events. And sure, I laughed when Jon Stewart said he was waiting to see the video of Senator Joe Biden spending a day with the International Brotherhood of Horse Testicles Handlers. But the union representing health care workers is using the novelty of seeing a U.S. Senator sweeping with a dust pan to draw attention to the very important work done by the R.N.s, LVNs, home health aides and orderlies who are members of their unions. If this is what it takes to begin to get people's attention, so be it.

Although Barack seemed more relaxed and genuinely interested, Hillary as usual got straight to the point when she remarked how important nursing-patient ratios are. In Nevada, no state law mandates that hospitals limit the number of patients a nurse can handle per shift. So it important that the SEIU has negotiated nurse-patient staffing ratios for the nurses at the hospital Hillary visited. The nurse Hillary visited said that she still has too many patients to handle safely. In California, state law provides that hospitals most adjust their staffing levels to meet the actual needs of the patients they have admitted, and at a minimum the hospital must provide 3.2 licensed nursing hours per patient per day.

Even with a state law in effect, hospitals virtually never staff to meet the actual needs of the patients they admit, and more often than not don't have even the minimum number of nurses required under state law.

Barack visited the Oakland home of an 86-year-old home bound man who lives alone – sweeping the floor, making the bed and making him breakfast. Barack got it right when he said that the home health aide’s job description is “providing a life line to the outside world.” The man is in a wheelchair, and lives alone, but he's in his own home at least. The full-time home health aides enable him to stay in his own home and out of a rest home.

The home health aide gets health insurance, but even with union representation the home health aide gets no sick leave, no vacation benefits, and no overtime. She supports herself and 3 children on just $10 an hour.

Check out the videos, above, of the two Senators. Barack seemed to enjoy himself more, although he had the far messier job. But Hillary put in a full 12 hour day with the R.N., and then went over to the nurse's house for dinner.

Felicia Curran
www.ElderAdvocacyLaw.com

Sen. John Edwards recently spent a day at a nursing home, working with a certified nursing assistant, taking up a call made by Service Employees International Union members, to "walk a day in my shoes."

Edwards' day with Elaine Ellis began at a 3 a.m. early morning breakfast and continued with rounds at the nursing home where Elaine works. Edwards helped nursing home residents dress, helped serve meals, and helped out a nursing home resident who needed a shave.

She said that he seemed like a very nice person and she felt grateful that he took the time to find out what her world is like. He said that she seemed like a caring person and that she treated the home residents like family.

Elaine actually works two jobs, from 7 a.m. to 3 p.m. at one nursing home, and then from 3:30 p.m. to 9 another nursing home. When Edwards left, Elaine went to work at her second job.

She works two jobs because she does not make enough from her first job to support herself.

You have to wonder how she could possibly be doing a good job for the residents at either home, given how exhausted she must be. She's been doing this routine for more than 17 years.

Edwards was not there to critique her or the nursing home, however. He was there to watch and learn. Let's face it: neither the nursing home or the union would have let him in the door if there was any chance of that happening! At another time, Edwards needs to address the issues of understaffing, poor training, and low wages at nursing homes if this visit is to be more than a photo-op.

SEIU represents nursing assistants and some licensed nurses at the few nursing homes that are unionized. SEIU has invited all candidates for president, Democrats and Republicans, to experience firsthand what the employees' lives are like by spending a day with an employee.
Sen. Clinton, Sen. Dodd, Gov. Richardson, and Sen. Biden have all accepted the invitation. None of the Republican candidates have responded.

For more on the Walk in My Shoes Challenge, check out the SEIU website.

Click here to watch a short video clip from Edwards' day with Elaine.




Felicia Curran
www.ElderAdvocacyLaw.com

The blog's March 27th entry related to the New York Times article, “Aging, Frail, and Fighting Insurers to Pay Up,” describing the despicable practices that some long-term care insurance companies use to avoid paying for long-term care for their elderly policyholders. Remember Mary Derks, pictured here with her daughter? Well, put your hands together for Senator Barack Obama, who, after reading the Times article, wrote a letter to the head of the Government Accountability Office calling for an investigation into long-term care insurance. This is the text of his letter:

"April 5, 2007

The Honorable David M. Walker
Comptroller General
U.S. Government Accountability Office
441 G Street, NW
Washington, DC 20548

Dear Mr. Walker:

A March 26, 2007 article in the New York Times investigated the
practices of several long-term care insurers and reported a number of
troubling findings about practices that "make it difficult - if not
impossible - for policyholders to get paid." According to the article,
nearly 1 in every 4 long-term care claims in California was denied in
2005.

Nearly 9 million long-term care policies had been sold as of 2002, the
most recent year for which data were available, with about 80 percent
purchased through the individual market and the remaining 20 percent
purchased through the group market. These products provide elderly
Americans with coverage for care in their homes, assisted living
facilities, and nursing homes. This range of services is critical for
the health and financial well-being of seniors, 70 percent of whom
will require long-term care at some point in their lives.

Long-term care is a problem of national significance. As the baby
boomers age, policymakers are struggling to design a long-term care
system that meets the needs of Americans with disabilities. While
progress has been made, the long-term care system is heavily biased
towards institutional care, and the quality of care is often poor.
Moreover, nursing home and home care are very expensive, and Medicare
coverage for both is limited. As a result, catastrophic out-of-pocket
expenses for nursing home and home care by American's older people are
routine, forcing many to rely on Medicaid to finance the care they
need.

The federal government has taken steps to promote the use of long-term
care insurance. The Long-Term Care Partnership Program, a
public-private partnership between states and private insurance
companies, is one such example. The Federal Long-Term Care Insurance
Program, sponsored by the Office of Personnel Management for federal
employees, is a second example. In addition, the Health Insurance
Portability and Accountability Act has profoundly shaped the long-term
care market by establishing standards regarding the characteristics of
policies whose premiums can count towards the tax deduction available
for health care costs that exceed 7.5 percent of income.

I have a number of serious concerns about the long-term care insurance
market and its ability to fulfill its promises to its policyholders.
First, I am concerned about the possible arbitrary denial of insurance
benefits to seniors at their time of need. Second, I am concerned that
some insurers may be enticing individuals to buy policies by offering
low premiums, and then sharply increasing premiums if lapse rates are
not as high as assumed in the premium calculations. Third, a
substantial percentage of policies do not offer inflation adjustments,
resulting in a significant erosion of purchasing power in later years.
Even worse, some companies offer "inflation coverage," which allows
policyholders to purchase additional coverage at a later date, but at
the price charged to older purchasers. Premiums increase dramatically by
age, and individuals who elect to buy coverage later may not realize
that such coverage will be extremely expensive, which may be
financially infeasible.

Given the role of the federal government in long-term care financing,
I request that GAO investigate these allegations and the adequacy of
state and federal regulation. Specifically, I request that GAO review
the practices of these insurers in order to assess the following:

-- Rate of denial of claims, and as feasible, the extent to which
denials were justifiable;

-- Types of policies purchased, including the percentage of policies
that do adjust and do not adjust for inflation and those that allow
for purchase of additional coverage at a later date;

-- Estimated loss of purchasing power for those individuals that have
policies without inflation adjustment provisions;

-- Frequency and amount of premium increases in already purchased
policies, average lapse rates of policyholders, and the correlation
between premium increases and lapse rates;

-- Extent to which long-term care policies are marketed to individuals
that would likely qualify for Medicaid or may not have substantial
assets to protect; and

-- What, if any, additional federal regulation is needed.

Thank you.
Sincerely,
Barack Obama
United States Senator”

To read the New York Times article, click here.

Future editions of Elder Advocacy Blog will track both the talk and the walk of the 2008 Presidential Candidates on issues of elder medical care and nursing home abuse and elder abuse prevention. We need to make elder advocacy part of the national debate in electing a new president.


Felicia Curran
www.ElderAdvocacyLaw.com