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<< Previous   of   Next >>   ADVERTISEMENT   CONTACT THE HERALD Melanie Munk, Features Editor munk@heraldnet.com   Published: Tuesday, October 23, 2007 Retirement costs bring a sting Seniors must hold officials accountable By Linda Bryant Smith Herald Columnist My patio is shaded by a massive trumpet vine, pretty impressive at a distance and entirely different when you require its shelter. It reminds me a lot of the government serving our so-called golden years. If you sit out there, it won't be long before your head starts to itch. That would be the no-see-ems; invisible, stinging insects that create general misery. Wasps are a more visible presence. They'll nail you just because they can. If you're receive Social Security, Medicare or both, get ready to join me on the patio. The no-see-ems and wasps have been busy planning for our financial future. Wednesday the feds announced a 2.3 percent cost of living adjustment (COLA) for Social Security in 2008. On average, that means about $24 more per month. Most of the 48 million Americans who are 65 or older and receive Social Security depend on it for at least 50 percent of their total income. One in three beneficiaries rely on it for 90 percent or more. So in 2008, the average retired worker will collect $1,079 a month. The average for an aged widow or widower living alone will be less, $1,041. That's before they deduct the cost of Medicare Part B, of course. You have to wonder if the folks in Washington D.C. who make these decisions live in some world of alternative reality where budgets aren't met, pork is always on the menu and money keeps rolling in. Oops, sting me, they do. And in their world they've devised, supervised and improved, as needed, their own special health care and retirement plans … good for life. They vote in their own raises. Still, despite these generous perks, you think they'd notice folks out here in the real world are paying more than $3 a gallon for gas and seeing similar price increases in heating fuel and electricity bills. The cost of groceries and medicine jumps every time we grab a grocery cart. Taxes on our homes, if we're lucky enough to still own one, have only one direction to go and that's up. The price tag for insurance -- home, car, medical, long-term care -- grows higher each year. The other zinger-stinger came earlier this month when the Medicare and Medicaid administration announced Part B premiums would increase 3.1 percent next year to $96.40 per month. However, folks at the big Ms neglected to share a little more math. Part B premiums have jumped 93 percent since 2001 when we paid $50 a month. At the same time, the COLA, which is supposed to help us with rising costs, has crept up just 19 percent in those six years. So how come? Well, while the government tracks spending patterns of older Americans, that is not the index used to set the cost of living increase for us. Nope. Instead, they use a consumer price index based on urban wage earners and clerical workers. It's a slow-rising index tracking younger workers who don't spend as much of their income on medical expenses as most seniors do. So when the small increase in Social Security benefits comes up against the real increase in living expenses, the result is a serious net loss for millions of folks who worked hard and had a different vision of their retirement years. And now, you may have noticed, the mailbox is jammed with promotions for the Part D prescription plan. Premium and co-pays will jump again in 2008. For three of my basic maintenance drugs, it was cheaper this year to go to Wal-Mart for the $4 prescription than to use my insurance plan's co-pay. Still, any major illness or injury would not involve $4 a month drugs. So I kept Part D. As a consolation for the $8 premium increase in 2008, there are NO co-pays for generic drugs as long as I order them in 90-day quantities from my insurance company's friendly mail-order prescription drug service. Call me crazy, but those drugs must be really, really cheap to produce. So why couldn't those cheap prices be passed along without interjecting those pricey insurance middlemen and a federal program that's draining the treasury? Oops, that would mean the stinger bees would not be collecting "honey" for their campaign funds from lobbyists representing insurance and pharmaceutical companies. And while the honey flows into Congress, it's no secret that all of these so-called entitlement programs for the elderly and disabled are doomed to failure in the next 20 years without substantial reform. Medicare's hospital insurance already pays out more than it takes in. Social Security will be in the same boat come 2017. Experts predict the Social Security Trust Fund will run dry in 2041. Not good news for the 80 million Americans born between 1946 and 1964 who could qualify for Medicare and Social Security in the next 22 years. And while those folks are still in the work force, some can also look forward to higher Social Security taxes. The maximum amount of earnings subject to that tax jumps from $97,500 to $102,000 in 2008. Those of us who worked hard and paid our Social Security taxes for decades toward the promise of a reasonable financial return in our retirement years are frustrated by what our investment has produced. Many workers paying into the system now doubt they'll ever see any return on their investment. Clearly, tough solutions are required with both Democrats and Republicans working together as an effective team to write and pass the legislation that brings those solutions to reality. Can they? If they were looking at Social Security and Medicare as the only options in their old age, they might feel a bit of sting in the butt themselves. Too bad we can't mount a federal referendum to create and pass that legislation. Until then, we must keep holding them accountable and doing a little stinging ourselves. Linda Bryant Smith writes about life as a senior citizen and the issues that concern, annoy and often irritate the heck out of her now that she lives in a world where nothing is ever truly fixed but her income. You can e-mail her at ljbryantsmith@yahoo.com.

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