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    Medicare hike could also hit some in middle class

    By RICARDO ALONSO-ZALDIVAR | Associated PressSat, Apr 13, 2013

    WASHINGTON (AP) — Retired as a city worker, Sheila Pugachlives in a modest home on a quiet street in Albuquerque, N.M., and drives an 18-year-old Subaru.

    Pugach doesn't see herself as upper-income by any stretch, but President Barack Obama's budget would raise her Medicarepremiums and those of other comfortably retired seniors, adding to a surcharge that already costs some 2 million beneficiaries hundreds of dollars a year each.


    More importantly, due to the creeping effects of inflation, 20 million Medicare beneficiaries would end up paying higher "income related" premiums for their outpatient and prescription coverage over time.


    Administration officials say Obama's proposal will help improve the financial stability of Medicare by reducing taxpayer subsidies for retirees who can afford to pay a bigger share of costs. Congressional Republicans agree with the president on this one, making it highly likely the idea will become law if there's a budget deal this year.


    But the way Pugach sees it, she's being penalized for prudence, dinged for saving diligently.

    It was the government, she says, that pushed her into a higher income bracket where she'd have to pay additional Medicare premiums.
    IRS rules require people age 70-and-a-half and older to make regular minimum withdrawals from tax-deferred retirement nest eggs like 401(k)s. That was enough to nudge her over Medicare's line.

    "We were good soldiers when we were young," said Pugach, who worked as a computer systems analyst. "I was afraid of not having money for retirement and I put in as much as I could. The consequence is now I have to pay about $500 a year more in Medicare premiums."


    Currently only about 1 in 20 Medicare beneficiaries pays the higher income-based premiums, which start at incomes over $85,000 for individuals and $170,000 for couples. As a reference point, the median or midpoint U.S. household income is about $53,000.


    Obama's budget would change Medicare's upper-income premiums in several ways. First, it would raise the monthly amounts for those currently paying.

    If the proposal were already law, Pugach would be paying about $168 a month for outpatient coverage under Medicare's Part B, instead of $146.90.

    Then, the plan would create five new income brackets to squeeze more revenue from the top tiers of retirees.

    But its biggest impact would come through inflation.

    The administration is proposing to extend a freeze on the income brackets at which seniors are liable for the higher premiums until 1 in 4 retirees has to pay. It wouldn't be the top 5 percent anymore, but the top 25 percent.


    "Over time, the higher premiums will affect people who by today's standards are considered middle-income," explained Tricia Neuman, vice president for Medicare policy at the nonpartisan Kaiser Family Foundation. "At some point, it raises questions about whether (Medicare) premiums will continue to be affordable."


    Required withdrawals from retirement accounts would be the trigger for some of these retirees. For others it could be taking a part-time job.

    One consequence could be political problems for Medicare. A growing group of beneficiaries might come together around a shared a sense of grievance.

    "That's part of the problem with the premiums — they simply act like a higher tax based on income," said David Certner, federal policy director for AARP, the seniors lobby.

    "Means testing" of Medicare benefits was introduced in 2007 under President George W. Bush in the form of higher outpatient premiums for the top-earning retirees. Obama's health care law expanded the policy and also added a surcharge for prescription coverage.

    The latest proposal ramps up the reach of means testing and sets up a political confrontation between AARP and liberal groups on one side and fiscal conservatives on the other. The liberals have long argued that support for Medicare will be undermined if the program starts charging more for the well-to-do. Not only are higher-income people more likely to be politically active, they also tend to be in better health.


    Fiscal conservatives say it makes no sense for government to provide the same generous subsidies to people who can afford to pay at least some of the cost themselves. As a rule, taxpayers pay for 75 percent of Medicare's outpatient and prescription benefits. Even millionaires would still get a 10 percent subsidy on their premiums under Obama's plan. Technically, both programs are voluntary.


    "The government has to understand the difference between universal opportunity and universal subsidy," said David Walker, the former head of the congressional Government Accountability Office. "This is a very modest step towards changing the government subsidy associated with Medicare's two voluntary programs."


    It still doesn't sit well with Sheila Pugach. She says she's been postponing remodeling work on her 58-year-old house because she's concerned about the cost. Having a convenient utility room so she doesn't have to go out to the garage to do laundry would help with her back problems.


    "They think all old people are living the life of Riley," she said.

    http://news.yahoo.com/medicare-hike-...-politics.html
    "There is nothing which I dread so much as a division of the republic into two great parties, each arranged under its leader, and concerting measures in opposition to each other. This, in my humble apprehension, is to be dreaded as the greatest political evil under our Constitution" - John Adams, March 4, 1797 Ė March 4, 1801

  2. #2


    Wickabee's Avatar

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    For month and months I've been reading about what Obamacare could do negatively. So many articles, so many "it could"s.

  3. #3
    Quote Originally Posted by Wickabee View Post
    For month and months I've been reading about what Obamacare could do negatively. So many articles, so many "it could"s.
    It is better to be aware of what could happen than cross your fingers and hope for the best and then be upset when what you hoped wouldn't happen happens anyway. Democrats put on their blinders and passed Obamacare, the rest of us prefer to not be quite so sheepish.

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    Quote Originally Posted by duane1969 View Post
    It is better to be aware of what could happen than cross your fingers and hope for the best and then be upset when what you hoped wouldn't happen happens anyway. Democrats put on their blinders and passed Obamacare, the rest of us prefer to not be quite so sheepish.
    At least President Obama tried to come up with a solution to the millions of uninsured. What was the republicans/conservatives solution again? If you don't have insurance then too bad drop dead. That dosen't sound like a pro life party to me.
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    Why is the USA Defense Budget more than 10 times greater than the next 15 countries combined? There is the source of all your woes.

    Start living life, stop shipping money to bell-ended countries, stop playing good cop, bad cop, and stop starting wars, it's that simple.

    You reduce your Defense budget by 8% and you can buy everyone in the USA lifetime Health Care and a Cadillac.
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    Wickabee's Avatar

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    Quote Originally Posted by duane1969 View Post
    It is better to be aware of what could happen than cross your fingers and hope for the best and then be upset when what you hoped wouldn't happen happens anyway.
    Yeah but every one of these articles is written as a fear piece. It could do this. LOCK YOUR DOORS! etc. My point is, I've heard enough about what it could do. Tell me when it actually does something.

    Quote Originally Posted by duane1969 View Post
    Democrats put on their blinders and passed Obamacare, the rest of us prefer to not be quite so sheepish.
    Blah blah, unnecessary partisan crap, yada yada...

  7. #7
    Quote Originally Posted by mrveggieman View Post
    At least President Obama tried to come up with a solution to the millions of uninsured. What was the republicans/conservatives solution again? If you don't have insurance then too bad drop dead. That dosen't sound like a pro life party to me.
    Yes, doing something, even if it is wrong, flawed, unplanned, unwanted and unfunded, is better than nothing at all...

    Quote Originally Posted by centrehice View Post
    Why is the USA Defense Budget more than 10 times greater than the next 15 countries combined? There is the source of all your woes.

    Start living life, stop shipping money to bell-ended countries, stop playing good cop, bad cop, and stop starting wars, it's that simple.

    You reduce your Defense budget by 8% and you can buy everyone in the USA lifetime Health Care and a Cadillac.
    My guess is our defense budget is larger because our country, our population and our scope is larger. I am fine with reducing our budget by 50% as long as all of those other countries grasp the concept that we won't be coming to help when they need our assistance. I am totally fine with no more peacekeeping or humanitarian missions. I would totally support pulling out of Iraq, Afghanistan, North Africa, South Korea, Japan, Turkey, Germany and every other foreign base and operation that we are involved in and letting the chips fall where they may.

    The Catch22 of this is that as soon as liberals get their way and we reduce the military budget and pull out of all of those countries they will then put their "bleeding heart" badges back on and begin demanding that we get involved to protect the innocents in other countries. It can't be both ways.

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  8. #8
    Quote Originally Posted by Wickabee View Post
    Yeah but every one of these articles is written as a fear piece. It could do this. LOCK YOUR DOORS! etc. My point is, I've heard enough about what it could do. Tell me when it actually does something.


    Blah blah, unnecessary partisan crap, yada yada...
    Um no. If you know anything about it then you know that Democrats controlled the House, Senate and WH and they passed the Obamacare bill in spite of GOP opposition and 2/3rds of Americans expressing opposition. I don't have the time to look up the poll right now, but I think it was Reuters that did a poll that showed barely half of Democrat voters (52% I think) supported the health care bill. It isn't partisan, it is fact. Democrats rammed through a health care plan that a majority of Americans opposed.

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  9. #9


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    Quote Originally Posted by duane1969 View Post
    Yes, doing something, even if it is wrong, flawed, unplanned, unwanted and unfunded, is better than nothing at all...
    So better the status quo than trying anything? Explains your stance on gun control.

  10. #10
    Quote Originally Posted by duane1969 View Post
    Yes, doing something, even if it is wrong, flawed, unplanned, unwanted and unfunded, is better than nothing at all... Ask the millions of uninsured if they would prefer that the gov't does nothing and just sits back while they die or lose everything because of no health insurance.



    My guess is our defense budget is larger because our country, our population and our scope is larger. I am fine with reducing our budget by 50% as long as all of those other countries grasp the concept that we won't be coming to help when they need our assistance. I am totally fine with no more peacekeeping or humanitarian missions. I would totally support pulling out of Iraq, Afghanistan, North Africa, South Korea, Japan, Turkey, Germany and every other foreign base and operation that we are involved in and letting the chips fall where they may.

    The Catch22 of this is that as soon as liberals get their way and we reduce the military budget and pull out of all of those countries they will then put their "bleeding heart" badges back on and begin demanding that we get involved to protect the innocents in other countries. It can't be both ways.

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