Responding to questions from constituents in Crescent City, U.S. Rep. Jared Huffman, D-San Rafael, discussed the need for more people to pay into Social Security as well as maintaining access to Medicare for seniors. He described the legislation he is co-sponsoring, which includes a bill that would increase the cost of living adjustment for seniors who receive Medicare benefits.
The congressman was joined by Helen DuVernay, the local coordinator for the Health Insurance Counseling and Advocacy Program, or HICAP, and Carroll Estes, founder of the Institute for Health and Aging at the University of California, San Francisco.
Roughly 50 people filled chairs at the Del Norte County Office of Education’s new Instructional Media Center. The audience included county supervisors Roger Gitlin, Martha McClure and Gerry Hemmingsen, as well as City Councilwoman Kathryn Murray, harbor commissioners Wes White and James Ramsay and Superior Court Judge Chris Doehle.
Huffman touched on reducing unemployment and raising the federal minimum wage as potential ways to increase the number of people paying into Social Security. He also briefly shared his views on the potential downsizing of Sutter Coast Hospital from Acute Care to Critical Access status.
“What I do know is I’ve got lots of Critical Access hospitals in my district and the ones that I do have feel that designation helps them get better funding from Medicare,” Huffman said. “In some communities it seems to be working, but if Del Norte believes that it doesn’t work, and they want to pursue another model, I want to be very deferential to you on that. I think that’s your call to make.”
According to Estes, who is on the Board of Directors for the National Committee to Preserve Social Security and Medicare, $2 billion in Social Security payments are spent in the communities that make up Huffman’s district, which extends from the Golden Gate Bridge to the Oregon border. In California, Social Security benefits bring in cash payments of more than $73 billion a year, she said.
To ensure that Social Security is able to meet its obligations beyond 2033, Huffman said the National Committee to Preserve Social Security and Medicare is hoping to increase the wage cap. Workers are assessed payroll tax on the first $109,000 they earn in annual income, which funds Social Security. Huffman said it’s not enough.
“The wage cap when it was originally set was supposed to capture 95 percent of the wages in the country and since that framework was set up our wage profile has changed,” he said.
Huffman pointed out that more people are at the lower end of the wage scale while those at the higher end are making “fantastic amounts of money that nobody thought could be made by human beings.”
Currently about 84 percent of the wages in this country are taxed to fund Social Security, according to Estes.
“We really do need to adjust that cap upwards so we once again capture 95 percent of all wages,” Huffman said. “If we do, then that’s going to put the trust fund for the long haul in really good shape.”
In Del Norte County, although she couldn’t give an exact number, DuVernay said the bulk of the people she sees at her office on Northcrest Drive rely solely on Social Security for their income after retirement.
“If they have the ability, they will do little part-time jobs to supplement, so they have a little bit more money,” she said. “But there are a lot of people I see that are just Social Security and no assets. They have spent them all along the way.”
As for Medicare, one resident, Paul Dillard, wondered why enrolling in Medicare wasn’t voluntary. Estes said enrolling in Medicare is typically required within three months of turning 65 unless the recipient is getting health insurance through another source. DuVernay pointed out that people are generally in better health at age 65 and people are encouraged to join Medicare at that age to help spread health-care costs around.
With the Baby Boom, roughly 10,000 people are retiring and becoming eligible for Medicare every day in the U.S., Huffman said.
“That is the silver tsunami,” he said, acknowledging that Medicare is in a deficit. “That is what creates the scary projections when you see the long-term projections of debt from Medicare.”
Huffman said there should be a way to voluntarily buy in to Medicare earlier than age 65. He said he is also co-sponsoring legislation that would create a single-payer health insurance system for all.
“Medicare’s a great, efficient form of health insurance. For what it does, it does really well,” Huffman said. “It just happens to serve a population that has exceptionally high health-care costs because it’s all seniors.”
Estes said she and at least 300 groups of advocates are very concerned about increasing costs of Medicare. The cost of Medicare takes up 26 percent of the annual income of seniors, and the lower a senior’s income, the higher their out-of-pocket expenses are.
“There’s unfortunately a proposal in the 2015 budget to increase costs and one of the key mechanisms, which is already in place to a modest extent, is sometimes called means testing, which is based on your income, (and is) increasing the premiums and payments you make into Medicare,” she said. “That is a worrisome issue.”
Roughly 70 percent of doctors in the U.S. accept Medicare, according to Huffman.
In Del Norte County, DuVernay said, most doctors accept Medicare, but if a patient has to leave the area to visit a specialist he or she may have to pay more.