At USA Today Medora Lee provides an example of how cost increases, particularly increases in the cost of health care, eat up the recently announced cost of living adjustment in Social Security and then some:
Social Security checks will increase next year, but for retired staffing company executive Lou Scrivani, 76, the bump won’t even be enough to cover increases in his health care costs, much less the inflated prices of everything else over the past year.
Starting in January, more than 66 million beneficiaries of the program will receive a cost-of-living adjustment, or COLA, of 3.2%, averaging out to more than $50 extra each month.
COLA is meant to help Americans keep up with inflation so they can maintain their standard of living year to year. But the hikes are falling short, many seniors say. The cost of items older adults spend most of their money on consistently outpaces COLA, according to The Senior Citizens League, a nonprofit advocate for older adults. The biggest expense is health care.
She does the math. The Scrivanis are in the red.
I think this is a real public service on the part of Ms. Lee.
Although I am the oldest in my family nonetheless I am not retired. I keep toiling away. It’s galling to me that the steepest increases in prices in forty years are making it harder to save every year.
Yet I’m in a pretty good place compared to most people my age or older.
Yes, many people seem to be forgetting those on fixed incomes. Inflation is most ruinous for them, even with COLA, which only happens annually and doesn’t cover the effective losses over the previous year.
I read through the article. I am not sure why there was an increase in their deductible. Why would that necessarily be related to inflation? More likely they have have a Medicare Advantage plan or something and got in at a special deal and now it has increased. AS we know, health care costs recently had not been increasing like they had in the past.
But to her point, if health care costs increase faster than SS adjustments, then this has been a problem for the last 30-50 years. This could be addressed by increasing COLA or trying to fix medical costs, but there isn’t the political will to do either. I would note that on the cost side people do have some control. Older, generic meds are generally pretty cheap. If their deductibles went up $60/month I would bet that they have been moved on to some newer drugs. They should ask to stay on their older meds. These may not work as well but that is what COLA accounts for, not changing to a new and (theoretically) improved version.
Steve
Addressing that problem will be way down the list of national priorities, the fixed income crowd lack the resources to make it higher up the list.
The fixed income crowd votes in very high percentages and has an outsize influence on our politics. However, in this case they have been supporting the party which will avoid cutting SS but wont do anything to address this issue. Dems would be quite happy methinks to increase SS benefits and finance it by increasing the amount of income subject to tax or whatever is needed.
Steve
Steve: Covid
https://www.cnbc.com/2023/09/17/why-health-insurance-is-poised-to-make-inflation-jump.html#
Yet another byproduct of Covid policy hysteria.
? Reflects more the weird way the Fed measures health insurance when doing inflation numbers. Using their profits to calculate inflation is just odd. They can obtain direct measures of health care costs and follow those. Insurance costs will follow those costs. Since insurance doesnt cover all health care spending it would be more accurate I think. Anyway, as they point out the actual effect on inflation is tiny.
Steve
steve –
Dude, that’s your beloved government. Solver of all problems. They could fuck up a wet dream.
What other issues do you want them to fuck up? The ongoing absolute failure of all things green?
I’m not anti government, anti green anti anything………..if it works. But as an empirical fact government policies are almost always the worst choices in the bunch.
Inflation is raping the middle and lower class. Thank you Joe. Try to actually have some sympathy rather that defend your precious government.