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Friday Alert
Friday, April 24, 2009
(Alliance for Retired Americans)
Medicare Advantage Plans Face Changes in
2010
The Centers for Medicare and
Medicaid Services recently established stricter
rules for private insurance companies,
effectively cutting subsidies to Medicare
Advantage (MA) plans by up to 5%.
Currently, the government overpays MA plans an
average 14% more per beneficiary than for
traditional fee-for-service Medicare.
However, according to The Wall Street Journal, under
the new regulations, MA plans cannot charge
low-income and sick patients more than
traditional Medicare, must explain what is
covered in the Part D "doughnut hole" coverage
gap, and will face extra scrutiny if patients'
annual out-of-pocket costs are not capped at
$3,400 or less. The changes are designed
to allow consumers to more easily compare
options and costs. Medicare officials
said they would try to eliminate plans with
fewer than ten enrollees that are similar to
other plans and make it hard for seniors to
compare. Also changing: charges for
hospitalizations, outpatient services and other
services often associated with chronic
illnesses - services for which MA plans have
been particularly likely to charge patients
more than traditional Medicare would.
However, many industry experts say
beneficiaries enrolled in MA plans will likely
face increased premiums or fewer benefits next
year. "The Alliance welcomes the
changes," said Edward Coyle, Executive Director
of the Alliance. "Insurance companies
will no longer be able to use their government
subsidies to unfairly treat sick and
disadvantaged seniors."
Retirees Not
Prepared for Long-Term Care Costs
The high cost of long-term health
care (LTC), as much as $77,000 a year for
nursing home and $20,000 for in-home care, will
diminish the quality of life for two-thirds of
retirees, found the Center for Retirement
Research at Boston College. Factoring in
the costs of health care and LTC, a new study
concluded 64 percent of retirees would not be
able to maintain their pre-retirement
lifestyles. Only 3 percent of current
long-term care recipients has purchased private
LTC insurance, which costs around $300 a year
when purchased at age 65 but can skyrocket to
$600 a month by age 75. Additionally, the
Associated
Press reported that 20 percent of
applicants are denied coverage due to poor
health. "Numbers like these are why the
Alliance supports the Community Living
Assistance Services and Supports Act of 2009
(CLASS Act, S. 697 and H.R. 1721) to create an
insurance program for adults who become
functionally disabled," said Ruben Burks,
Secretary-Treasurer of the Alliance. The
CLASS Act will establish a national insurance
program, financed by voluntary premium payments
collected through payroll withholding and
placed in a "National Independence Fund."
See the Alliance's 2009 CLASS Act fact sheet at
http://www.retiredamericans.org/ht/a/GetDocumentAction/i/12355.
Advertisers Now
Going After Older Shoppers
According
to The New
York Times, the recession has led to a
trend of increased interest in the marketing of
goods and services to consumers age 50 and
older. Among those aiming more at the older
demographic are corporate giants such as
Chrysler, Kraft Foods, L'Oreal, Procter &
Gamble and Target. For decades, older
consumers had largely been shunned by marketers
because they were deemed less wealthy, less
likely to try new products and less willing to
change brands. However, the recession is
making older consumers who may have paid off
mortgages seem like a safer bet than younger
ones who may get laid off in last-hired,
first-fired downsizings. Another reason
for the change is demographic. The
estimated 78 million baby boomers born from
1946 to 1964, who are vital to Madison Avenue,
are aging, with the first boomers turning 63
this year. Also, older consumers today
are seen as less resistant to change and more
comfortable with digital media. The web
site www.grandparents.com
predicts that by next year, the highest median
income will be among families led by men or
women ages 55 to 64.
Recession Pushes Retirement Confidence
To A Record Low
In a survey released
by the Employee Benefit Research Institute this
month, only 13% of workers and retirees said
they were very confident they could live well
in retirement, the lowest number since tracking
began in 1993. Among current retirees
included in the study, only 20% said they were
very confident that they could live
comfortably. The Washington Post reported
that current retirees were greatly surprised by
the high costs of their health care
expenses. Workers and retirees also
credited inflation, economic uncertainty and
the high cost of living as reasons for their
lack of confidence. Of those surveyed,
over 80% have reduced their expenses, 43% have
changed their investing behavior and 38% are
working more hours or picked up a second
job. "Every worker deserves peace of mind
that he or she can retire comfortably," said
Barbara J.
Easterling, President of the
Alliance. "Unfortunately, the combination
of serious problems facing our nation today has
led to widespread uncertainty for retirees and
workers nearing retirement."
Alliance Organizer
Jack Marion Honored with Community Service
Award
Alliance for Retired Americans
North Carolina Field Organizer Jack Marion
received the state's Asa Philip Randolph
Institute's (NC APRI) award for community
service at their 35th Annual Award Banquet on
Saturday, April 18, in Raleigh. Labor
leaders Asa
Philip Randolph and Bayard Rustin
founded the APRI in 1965 as a non-profit,
non-partisan organization of black trade
unionists to fight for racial equality and
economic justice. North Carolina APRI
chapters provide support for local unions and
for community members in need. "Through
his lifelong activism, Jack has truly made a
difference in protecting jobs for Americans,
defending seniors' benefits and supporting
affordable health care for all," said
Coyle. "We are incredibly proud of all of
his past efforts, and look forward to working
together for many years to come."
Register Now for the
Alliance Legislative Conference June 15-18,
2009
The Alliance's 2009 Legislative
Conference will take place June 15-18 in
Washington DC at the Washington Hilton.
Come and see your congressional representatives
and share ideas with new Administration
officials who are friendly on retiree
issues! In seminars, sessions, and
one-on-one meetings, you will be key in
ensuring that seniors get the change we fought
for in 2008. To register, call
1-888-373-6497, go to www.unionvoice.org/retirees/events/conf_2009/details.tcl
or e-mail Joni
Jones at jjones@retiredamericans.org.
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