House Bill to Expand, Strengthen Social Security

Published in Woosocket Call on February 3, 2019

With the 116th Congress kicking off on January 3, 2019 and the Democrats seizing control of the House, it did not take long for a bill to emerge that would strengthen and expand the nation’s Social Security program. Seven years ago, when U.S. Congressman John Larson (D-CT) first introduced the Social Security 2100 Act during the 113th Congress, the GOP controlled Congress blocked a fair hearing and vote. Now, with a Democratic majority in the House Larson’s Social Security proposal will finally get a thorough review as Democrats take control of the House Ways and Means, Energy and Commerce, and Education and Labor. These committees have oversight of Social Security.

Larson chose to throw the bill into legislative hopper on the 137th anniversary of President Franklin D. Roosevelt’s birth, who signed Social Security into law in 1935.

On January 30, 2019, Larson, recently appointed to chair of the House Ways and Means subcommittee on Social Security, introduced H.R.860, the Social Security Act 2100 Act, with over 202 House Democrats cosponsors (including Rhode Island Representatives David N. Cicilline and James R. Langevin), to ensure the retirement security of working Americans for another century.

Passage of the Social Security 2100 Act only requires a simple majority vote of 218 lawmakers. With 235 Democratic lawmakers sitting in this chamber, it is expected to pass. But, with the Senate-controlled by Republican Majority Leader Mitch McConnell of Kentucky and his GOP caucus, it will be difficult for Senators Chris Van Hollen (D-MD) and Richard Blumenthal (D-CT) to see their companion measure make it to the Senate floor for a vote.

H.R. 860’s eight provisions expand benefits for 62 million Social Security beneficiaries. It would provide an across-the-board benefit increase for current and new beneficiaries that is the equivalent of 2 percent of the average benefit. It also calls for an improved cost-of-living adjustment (COLA), through adopting a CPI-E formula, that takes into account the true costs (include health care expenses) incurred by seniors and a stronger minimum benefit set at 25 percent above the poverty line, tied to their wage levels to ensure that the minimum benefit does not fall behind. Finally, the bill would ensure that any increase in benefits from the bill do not result in a reduction in SSI benefits or loss of eligibility for Medicaid or Children’s Health Insurance Program. Finally, 12 million Social Security recipients will receive a tax cut through the eliminating the tax on their benefits.

Increasing the Financial Solvency of Social Security

According to an independent analysis of the Social Security’s Office of the Chief Actuary, H.R. 860 proposal would also strengthen and protect the Trust Funds by 75 years.

H.R. 860 would have wealthy individuals pay the same rate as everyone else. Presently, payroll taxes are not collected on wages over $132,900.
Larson’s legislation would apply the payroll tax to wages of $400,000, affecting the top 0.4% of wage earners. The bill gradually phases in an increase in the pay roll contribution rate beginning in 2020, of 50 cents per week, so that by 2043 workers and employers would pay 7.4 percent instead of 6.2 percent. Finally, the bill’s provisions would combine the Old-Age and Survivors, called Social Security, and the Disability Insurance trust funds into one Social Security Trust Fund, to ensure that all benefits will be paid.

“Social Security is a promise that after a lifetime of hard work, you should be able to retire with dignity and economic security. It’s critical that Congress preserve and strengthen this promise for years to come,” said Cicilline, who serves as Chair of the Democratic Policy and Communications Committee, representing Rhode Island’s 1st congressional district.

Larson, recently appointed chair of the House Ways and Means Subcommittee on Social Security, noted, “With 10,000 baby boomers becoming eligible for Social Security every day, the time to act is now. The Social Security 2100 Act will provide economic security not just for today’s seniors but for future generations too,” said Larson, as the bill was thrown into the legislative hopper.”

There have not been any significant adjustments to Social Security since 1983, when Tip O’Neill was Speaker and Ronald Reagan was President, said Larson. “It’s time for Congress and the President to come together again, just like Speaker O’Neill and President Reagan did to make this a reality, he said.

“For years, fiscal hawks have told us that the only way to ‘save’ Social Security is to cut benefits for future retirees. Congressman Larson’s bill is a resounding rebuke to those claims. The Social Security Act 2100 keeps the program financially sound for most of this century while boosting benefits for millions of beneficiaries,” said Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare.

Richtman says, “Congressman Larson has promised that, for the first time, this legislation will receive thorough consideration in the U.S. House, including hearings with testimony from experts and the public. We applaud him for his vision, persistence, and advocacy on behalf of America’s current and future retirees in moving this bill forward.”

Today, more than 222,000 Rhode Islanders receive Social Security benefits today. It is the most important retirement income for 4 out of 5 seniors and provides financial protections to disabled workers and families who have lost a breadwinner.

For decades, GOP lawmakers pushed its Social Security reforms by privatization, raising the retirement eligibility age and imposing stingier COLA formulas. But, national poll after poll, across party lines and age groups, revealed the public’s strong support for the nation’s retirement program.

Washington Insiders expect Larson’s Social Security bill to pass the House. While GOP Senate leadership keeps the companion measure at arms-length, the upcoming 2020 elections may well grease the legislative wheels for passage. Over 20 Republican Senate, whose seats are at serious risk, may well vote for passage with Democratic Senators.
Stay tuned…

Advertisements

Social Security Recipients Thirsty for COLAs

Published in Pawtucket Times on October 19, 2015

With Christmas fast approaching, almost 65 million people who collect Social Security checks will get hit hard in their pocketbooks. On Thursday, the Social Security announced that there will be no cost of living adjustments (COLA) for 2016. It’s the third time this has happened in over 40 years. .

Unless Congress promptly acts to change the law to give COLAS, Medicare premiums will also be increasing dramatically for almost one-third of Social Security recipients. “The average American senior simply can’t afford a triple-digit increase for their Medicare coverage, says Max Richtman, President/CEO of the National Committee to Preserve Social Security and Medicare (NCPSSM) in a statement. The Washington, D.C.-based organization has lobbied Congress to pass legislation to address this urgent policy issue. “For millions of seniors, this large Medicare hike is devastating and a result of a well-intended “hold harmless” provision that left out too many Medicare beneficiaries,” he says.
.
According to Richtman, “All of this was triggered by a zero COLA increase in Social Security for 2016, confirming yet again, that the current Social Security COLA formula isn’t accurately measuring seniors’ expenses. Seniors across this nation understand how important having an accurate measure of the increase in their real costs is to their day-to-day survival.”

House Democrats Rally for a COLA

Just one day before SSA’s announcement of no COLA next year, Congressman David N. Cicilline (D-RI), and 55 Democratic House members had sent a letter to the Social Security Administration (SSA) calling for the federal agency to find a way to provide a COLA for 2016. Not surprisingly Cicilline was not joined by House GOP lawmakers. Only Congressional action can revise this decision.

In the Ocean State, there are 153,349 beneficiaries who received $266,541,000 in total benefits in December 2014. In January 2015, beneficiaries received a 1.7% COLA, which averaged $29.55 per month, or $354.58 per year.

“Seniors, who are relying on Social Security for their retirement, have seen the costs of everything go up and deserve a COLA so they can have their basic needs met,” said Cicilline. “I hear from Rhode Islanders every day who are living on Social Security about their struggles with the rising costs of housing, food, and medicine. In fact, it seems everything is going up, except their Social Security check and this is dead wrong.”

SSA’s announcement on October 14 clearly shows that the current method of calculating COLA’s for Social Security beneficiaries negatively impacts the recipients, says Cicilline. The Democratic Congressman calls on Congress to quickly fix this problem now. The lawmaker has co-sponsored H.R. 1811, the Protecting and Preserving Social Security Act, to do just that.

Cicilline charges that the Social Security Administration has used the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) to determine whether the cost-of-living has increased. According to the Washington Post, the “biggest reason retirees aren’t getting a raise” is due to lower fuel prices, even though medical, housing, and food costs have increased.

It’s time to change the way COLAs are calculated, says Cicilline. Critics to the existing formula charge that fuel prices are less important in determining cost of living for the nation’s seniors – individuals ages 65 and older make up only 16% of all licensed drivers in the United States. To fix formula glitch, Cicilline has signed on as a co-sponsor of the CPI-E Act, which would replace CPI-W with the Consumer Price Index for the Elderly. CPI-E more accurately reflects cost of living for today’s older persons by weighting the cost of housing and medical care more compared to CPI-W. It also de-emphasizes fuel and transportation costs.

Blunting the Pain of Medicare Premium Hikes

Promptly responding to SSA’s double whammy of no COLA for 2016 and hikes in Medicare premiums, AARP, the nation’s largest aging advocacy organization in a letter called on Congress to “pass a fix.”

In her correspondence, Nancy LeaMond AARP’s EVP and Chief Advocacy and Engagement Officer, asks Congress to protect all Medicare beneficiaries from sharply increased out-of-pocket costs in light of the COLA announcement, requesting specifically that Congress “reduce. the impact of the sudden, sharp increases in the Part B premiums and deductible as soon as possible. Ideally, all Medicare beneficiaries should be held-harmless in the face of no Social Security COLA adjustment.”

LeaMond’s letter notes that 16.5 million Americans face sharp premium increases and that “all Medicare beneficiaries will see their Part B deductible increase 52 percent…from $147 to $223.” Additionally, AARP reiterates its opposition to the Chained Consumer Price Index (CPI), noting that “the Social Security COLA would be even more inaccurate and benefits would be even less adequate if recent proposals to adopt a Chained CPI had been enacted.

AARP has opposed all Administrative and Congressional attempts to enact a Chained CPI, and says it will continue to do so, says LeaMond, because the Chained CPI would further under reported inflation experienced by Social Security beneficiaries, and further erode their standard of living, cutting an estimated $127 billion in Social Security benefits from current and near retirees in the next ten years alone.”

With Capitol Hill polarized by political a House and Senate captured by ultra conservatives, Social Security beneficiaries will have to find ways to stay financially afloat until Congress can reduce the damaging impact of the Part B premium increases with no COLA increase to reduce the pain. Aging groups push for holding beneficiaries harmless to Medicare premium increases. With the election over a year off, law makers might just listen or face the wrath of older Americans who just exercises their right to vote at the polls.

Herb Weiss, LRI ’12 is a Pawtucket writer covering aging, health care and medical issues. He can be reached at hweissri@aol.com.