New York State "reforms" pensions for its own employees

A New York Times editorial, “A Little Pension Refore”, on Saturday Dec. 5 describes a “reform” in pensions for New York State employees, link here. The reform raises the retirement age to 62 from 55, and limits the amount of overtime pay that can apply to pension calculations.

This reform goes along with the idea that employers need to keep people working longer. I “retired” from private industry at 58, when forced to during a downsizing, with somewhat of a decent pension payment given the amount of service and other circumstances. But that’s not a sustainable pattern for everyone.

Congress debates the CLASS Act, to provide help for aging at home; it would not replace long term care insurance!

Check out an AARP story on the proposed "CLASS Act" here.

Michael C. Burgess (R-TX) and Chris Van Hollen (D-MD) debate the proposed the proposed The CLASS (Community Living Assistance Services and Supports) Act to give people assistance at home. However Burgess argues that this does not replace Long Term Care insurance. Burgess also argues LTC insurance ought to generate tax credits, and that parents ought to be considerate enough of their children to purchase it! In states with filial responsibility laws, children could have to foot the bill as Medicaid gets stressed.



Update: Dec. 5

Check a contrasting story in the Saturday Dec 5 New York Times, front page, by Robert Pear, "Home Care Patients Worry Over Possible Cuts", link here, regarding Medicare' home health benefit for treatment for homebound patients.

Medicare and Medicaid challenges will make states enforce filial responsibility laws: and they're trickier than one thinks

Al Gore’s spectacular book “Our Choice” on climate change has a chapter on population demographics. Although I discussed that in my review of it yesterday on the Book Review blog, I’ll reiterate here that he referred to the “safety net” to care for the elderly available in western nations. I said there that I thought his coverage was a bit naïve, in that population demographics and economic contraction are going to strain the safety net, and put more responsibility back on families, especially adult children, and especially the childless.

Then consider the Editorial in the Washington Times: “Rationing Grandma’s health care: Democratic plans will exacerbate Medicaid coverage problems,” link here. Actually it’s both Medicaid and Medicare, as reported by CMS, and there specific (and justified) concerns here about gutting the private sector’s Medicare Advantage replacement programs. (Although, later Nov. 30, TV station WJLA reproted that most ot the Medicare Advantage cuts affect more fringe-like benefits for the better off, and that basic M.A. coverage could improve for some people.)

But the most critical point, and one that I’m surprised the Washington Times doesn’t hit harder, is the way responsibility will fall back on families. Almost thirty states have filial responsibility laws (as I covered on this blog starting July 2007), and they will certainly gain attention soon as states find their Medicaid budgets crimped. (To use the president’s pre-inauguration words last January, that can has already been kicked to the dead end of the road.) One can make a partial comparison to the voluntary responsibilities parents have for conceiving children – doing so might make a good high school English theme. It’s different: it’s not chosen, and it's just about "justice" as an individualist views "personal responsibility"; it comes about from being in a community. And it doesn’t happen to everyone, and one can normally use the parents’ funds to meet the needs until they are gone. But there are other subtleties: even if the parent has money and/or long term care insurance, and even given the presence of Medicare and supplementary coverages, the adult child is legally required to make sure that the parent gets the best available care, even at some self-sacrifice. The adult child cannot behave in a manner that could interfere with delivery of care, and that could become a more subtle point than many people realize. In some special situations, the adult child can be expected to prove that he or she is capable of a stream of support even when there are funds.

We will certainly see our idea of “social contract” challenged. And we need the open debate that has been kept out of the limelight, whether because of ignorance or out of fear of consequences, not just for politicians but more many naïve individuals.

Some public pension funds waste money on "parasitic" middlemen: How about CALPERS?

The “Deals & Deal makers” page C3 of the Wall Street Journal “Money & Investing” section today (Black Friday, Nov. 27) has an interesting “pension tsunami” story about how pension funds of major public sector employers may be diverting resources to manipulative but “undeserving” middlemen (call them “parasites”).

The story concerns CALPERS, the California Public Employees’ Retirement System, which reportedly continued using the services of two investment counselor firms (sort of the Vernon Albright – “My Little Margie” kind) after their contracts had expired.

The story is by Craig Karmin, is titled “For Calpers, a blunder on pay”, and has link here.

Such practices could gradually put even more strain on PBGC, eventually, and become a political issue.

Attribution link for p.d. Wikipedia picture of Sacramento waterfront. My last transit of the area was in Nov. 1995.

Some more discussion on hospice works

A note on hospice benefits: Once a patient enters a Medicare-approved hospice program, the Medicare hospice program pays for hospice services and for medical services and prescription drugs related to the condition (for example, heart failure or cancer) that led to the admission. Other medical services related to other conditions not causing the admission would be paid in a conventional way through Medicare, but all care is coordinated through the hospice (with special billing procedures).

Although hospice provides some home care with items like bathing, the patient (and therefore the patient’s family) is still responsible for proving (either in person or by hiring from a home health company) companionship, safety and custodial care, with necessary and appropriate continuity. In states with filial responsibility laws, adult children able to pay can be held responsible for these costs. (However, many hospices offer short respite stays to relieve caregivers or family members.) Hospice services do continue during hospital stays, skilled nursing stays, and can be arranged in assisted living and nursing home settings. (Assisted living facilities cannot themselves provide medical services other that prescription medication management, but the patient or family can bring services in from hospice.)

Medicare spending per patient varies enormously by location

Lester Holt on NBC Nightly News reported on Nov. 24 that Medicare costs vary enormously from one city to another, even in the same state or region. In Miami, Medicare spends about $16000 a year per beneficiary, in nearby Fort Lauderdale (in Broward instead of Dade County), about $9000, and in some parts of Oregon, about $6000. Much of the problem has a lot to do with how hospitals and emergency services are overused, with little consideration about costs.

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Making the young pay more for health insurance: does that help pre-Medicare retirees?

Robert J. Samuelson has an op-ed on p. A19 of the Nov. 23 Washington Post that indicates that seniors should back off on demanding their tribute in the way of entitlements. The article is titled “Health ‘reform’ that burdens the young,” link here. AARP says that even a 2:1 max on how much seniors can be charged more in premiums is too much; AARP wants a “community rating” which ignores age altogether.

Who stands to gain quickly by making the young pay more? Probably retirees below Medicare-age. More and more companies drop retiree health insurance; an individual premium from BCBS for me would have been $400 a month at age 64; with the employer retiree insurance it was about $180.

Samuelson does agree that insurance companies could or should be banned from discriminating on the basis of pre-existing conditions for “public policy” reasons, but age is not such a category. Working Americans already pay a Medicare tax. Not allowing insurance companies to price by age undermines the entire system, he says. But, for every one of us, youth is mathematically transitory. The only exception seems to be for the vampires in “Twilight”. (Maybe Robert Pattinson will always be 23.)