My cousin asked me if it was true that we wouldn’t get a Social Security Cost of Living Allowance next year. And, I had to tell her that it was true. According to my sources and the way I think our SS COLA is computed, we probably won't get an increase for the next two years. At this time, the COLA is computed based on the Consumer Price Index. The CPI is based on a typical "market basket" of goods and services purchased by US consumers in mid- to late-summer.
Last year, the price of gasoline was so high when they did this computation that the cost of that market basket was really high. So, they gave us a good COLA to reflect that (and a stimulus payment, too). Now, however, the price of gasoline and a lot of the other goods and services have gone down, so to balance it out, we won't get a COLA next year, and maybe the year after that.
One of my friend in Massachusetts is working with several groups to come up with a more equitable way to compute the real expenses of older people. The CPI, for example, uses costs of things like new refrigerators and furniture, groceries for a family of 4 including teen agers, vacation expenses, clothes and school expenses and lots of other things--anything that young and mid-life families might be buying. But, my friend thinks that the prices that older people pay are different. We probably are not buying new furniture, but instead are buying new knees and hips. We aren't feeding teen-agers, but we are probably buying diabetes and blood pressure drugs and medicines. We might not be paying for school, but are probably paying for help around the house. See what I mean? It is time that a different index should be used for the SS COLA that more correctly reflects what we old people are all paying for. Several states are trying out the new index (I don't know the name or where, but know that there are some eastern states that are trying this new index to determine some of their assistant payments. (Not Medicare which is determined by the feds.)
And, Yes. Our Medicare premiums will go up, but I don't know the real numbers yet.
That is one of the reasons we have been working to get some changes in the health care system. Medicare cannot keep spending like it is at this time without costing us more money or limiting the services that we get. And, Social Security COLAs probably won't cover the costs. We have got to get something changed.
A public universal health care system, based on the idea of Social Security, where everyone pays in and everyone can take out as they need to, makes a lot of sense to me.
But it has been bogged down by the people who are afraid of government programs. I even heard a guy at one of the town hall meetings say he wanted the government to keep their hands off his Medicare! Excuse me! Who does he think runs the Medicare program now? One person even said they didn't want the government messing with Social Security! Who do they think runs SS now? These are not perfect programs, but where would you and I be without them? Neither my long-suffering spouse nor I were in the military, so we can't depend on the Veterans services to help us. With all the medical problems we have had in recent years as we get older, without Medicare we would be living in a tent in the woods somewhere digging for mushrooms!
A public health insurance program, combined with private programs for those that can afford them, might happen. They are talking about making some kind of insurance mandatory for everyone with some government support for those who can't afford it. That would give the insurance companies more customers, wouldn't it? Even if they have to lower premium prices to match the public program, they would have more customers, wouldn’t they?
The problem is that they are talking about so many changes and so many different pieces of legislation, we can't possibly know what is going to happen. But, this is sure. They have got to make some changes or Medicare is going to go broke. And if Medicare goes broke, so do most low-to moderate income older people.
And we don't live in a vacuum. What affects us is going to affect our families. Instead of taking care of ourselves, we may have to go back to living with our kids to take care of us. Doesn't sound as much fun, does it?
Sorry, if I got carried away, but this is something that I have been working on since I started a job giving community education programs about SS and Medicare back in 1994. And I haven't stopped worrying about it, or working for change, just because I retired and quit being paid for what I was doing!
Thanks for letting me write it all down.
Gladys - OWL National Board Member