Friday, December 30, 2011

Social Security knocked away from being an annuity to another political entitlement

Today (Dec. 30, 2011), on p. A19, the Washington Post offers an op-ed by Robert J. Samuelson, “My argument with the elderly.”  Online, he calls it “Why we need to fix Social Security, and other year-end reflections”, link here.   

Samuelson says he is 66 (one of "them" or one of "us"), and maintains it would be progressive to ask better-off seniors to forgo their Social Security right now (at least some of it) and pay more for Medicare, to help the next generation, especially given the economy.  Means testing now, you bet.

Remember, last summer’s debt ceiling debate, when we could have stopped Social Security cold – depending on which lawyer you asked.  Michele Bachman didn’t seem to care.  John Boehner and Rand Paul were bellowing, “we can’t afford it; we don’t have the money.”

Yup, you can take someone like me, at 68, and say, “why won’t you go out and hucksterize for a few years, like everybody else.  You spent 12 years in life insurance IT, why don’t you think enough of it that you want to sell it?”  Bye to movies and blogs.

But I thought the benefits were promised, even contractually owed, based on “annuity premium” contributions.  If you want to moralize, all right, but don’t play Robin Hood with what is already mine. Oh, nothing is mine – I get it.  “It isn’t about you” Rick Warren says.

The Post has a detailed news analysis today, front page, by Jia Lynn Yang, “New fear for Social Security’s future: Payroll tax cut could take program off its political pedestal”, and eventually make promised benefits be perceived as political fodder. (Online the article is called simply "Tax cut shakes a premise of Social Security".)  We’ve stopped making current workers  pay their own full premiums.  (Some want parents to be absolved of all FICA “taxes”).  That’s why privatization, proposed during the Bush years – was so appealing – turn it into something you own, forced savings mandated by law, albeit, and regulated away from risk – but keep it out of the hands of Robin Hoods. Fight your battles of “deservedness” elsewhere.

(See Dec. 22 posting about related Post editorial.)


Wednesday, December 28, 2011

Public employees can often buy "air time" to pad their retirements.

Thomas Frank has a provocative story in USA Today Wednesday showing how workers in 21 states can buy “air time”. effectively credit for more time worked, to increase their pensions after they retire, link here

In some states, the practice was part of a plan to try to encourage early retirement. In California, over 34000 people have “bought” the time, but Jerry Brown wants to end the practice. In many states, employees are not "contributing" enough to pay for their extra retirement benefits according to actuarial calculations.

Federal law allows “air time” purchases in public employee plans only, not in private industry. 

Saturday, December 24, 2011

Washington Post spurs debate on integrity of hospice care


Today, in the Washington Post, several parties weighed in on the ethics if the hospice care industry, primary link (for a letter from the National Hospice and Palliative Care organization, here.  

All of this refers back to a Dec. 18 Post Business story “The big payoff of pushing patients into hospice”.
 
It is true that a doctor must sign off on the prospect that the ordinary course of a patient’s illness means a life expectancy of less than six months.  It can be renewed. 

My own mother entered hospice Nov. 24, 2009 and stayed at home, actually entering the facility Dec. 10, 2010, four days before she passed away from aortic stenosis and congestive heart failure just after her 97th birthday. 

Admission to the program required an interview and examination by a nurse and detailed review of medical records, including recent tests (such as echocardiogram, where there are specific metrics predictive of probable survival when heart function is already severely impaired). 
 
Hospice home care typically results in billing to Medicare of $3000 to $4000 a month. 

Thursday, December 22, 2011

Washington Post plays the "entitlements v. the poor" card today


Today, the Washington Post has an editorial that does make sensible recommendations about state (VA) pension reforms and gradual Social Security changes. But there is some emotional language that is a bit off-putting. 
 
The title of the editorial (link) is “Entitlements vs. the Poor” (then subtitle “Virginia’s proposed budget shows why liberals are wrong to resist pension reform”).  But then it writes “There should be more means-testing, for example, so that poor taxpayers are not subsidizing wealthier ones.” 
 
Remember, as repeated here like from a cracked CD, Social Security is, in large part, funded by past contributions by the recipient and his/her employers.  Defined-benefit pensions are certainly related to service performed. 
  
That’s one reason why I have felt sympathetic (to say the least) to gradual Social Security privatization, so that the recipient owns his own benefits and so that they can’t be confiscated for someone else’s political agendas.
For example, some on the “natural family” movement want to exempt people from social security taxes once they have children within marriage. 
 
And a payroll tax holiday, however it may seem to help lower income wage earners in the short run, seems just to make the Social Security deficit grow. People have to continue making contributions for their own future benefits.  The right way to address lower take home pay is to address the causes of lower wages.  Maybe we need more  guinea pigs like Barbara Ehrenreich to pay their dues.

Sunday, December 18, 2011

Increased lifespans: we may be approaching a "singularity"


An Opinion piece in the New York Times Sunday wonders of we’re approaching an inflection point, were we unlock the key to immortality and all become angels – at least digitally, maybe on the Web, without bodies. “Omni” magazine had proposed as much in the 1990s. 
 
The piece by James Atlas is “Old Age – Life Goes On”, link here

Atlas discusses a book by Ray Kurtweil, “The Singularity is Near: When Humans Transcend Biology” (Penguin, 2006).  There’s a physics question, maybe: if anyone were immortal, would that contradict the Second Law of Thermodynamics?  Entropy seems to make aging inevitable, but then what happens to the soul?
 
In the meantime, as biological lifespans increase sharply, Atlas writes, “One challenge my entitled generation faces is that many of our long-lived parents are running through their retirement money, which leaves the burden of supporting them to us.”  The term “sandwich generation” is still relatively recent, and nobody applies it correctly to the childless. 
 
In view of all of this, many of the proposals to fix Medicare sound meager indeed. But today’s Times has a major editorial and other materials on it. Generally, Congress is considering making public coverage v. subsidized private coverage a choice, giving states more control, trying to discourage first-dollar coverage, and trying to simplify reimbursements.   And it considers increasing means testing – some of which happens now. I wasn’t aware that those making over $85000 pay more premiums now. What about looking at accumulated assets then (as Medicaid already does)?

Thursday, December 15, 2011

"Wal-tirement" DRIP's: they're not like i,v;'s, but you can do them yourself


The Washington Times today sent out an email (or at least an email was sent out in its sender name) talking about “Wal-tirement” and how to plan for your retirement without depending on social security or pensions. 
  
The company selling the product of easy automated stock buybacks is Stansberry Research (link), and the email led to one of those manipulate videos that keeps leading you on and that you have to click a few times to get out of.  
  
Here’s a discussion of  (Dividend Reinvestment Plans) DRIP investing at “Stock Gumshoe”  by Travis Johnson, link.   It sounds like something you can do for yourself pretty easily, not gimmicks or hucksters needed.


Wednesday, December 14, 2011

In Memoriam: my mother's passing occurred one year ago today

One year ago today, Tuesday Dec. 14, 2010, my mother passed away, at age 97, in Capital Hospice, in Arlington, VA.
 
She had entered four days before, but had been in Hospice care at home under Medicare rules since November, 2009.  

There was a last day in her home (Dec. 10), a last meal (Dec. 9), and earlier last times she had gone to church, a last time she had traveled (to Ohio), and even a last time she had gone anywhere on her own (mid 2009). 

She lived long enough to see introduction of the law that would repeal "Don't Ask Don't Tell", which had meant so much to me, even though at the end of her life she no longer understood what it had meant. 

My father’s passing, on New Years Day of 1986, at age 82, had been much more sudden.

Of course, the idea that there is a last experience of many things for us is just a mathematical tautology.  But we are much more aware of this now than earlier generations had been

Medicine is changing the last period of life for many people.  There are discussions that new generic vaccines may wipe out most forms of cancer.  People get many extra years with heart surgery and other treatments.  But eventually, none of us is immortal.   For many more people than ever before (even though not for all people) the length of time at the end of life with severe disability, and perhaps Alzheimers, is a new challenge for this generation, with fewer children and eventually fewer workers to take care of their parents.  This will happen on a scale that earlier generations did not know, even with their more cohesive families. 

I noted today that Congress is still discussing (and the president wants) the Social Security tax partial break to continue, while the trust fund to pay future beneficiaries gets weaker.  We still don’t want to have to pay for our benefits, although many of us will wind up giving them to others through care.   Even now, one can imagine tradeoffs and redistributions, like immediate means testing to “pay for” the social security tax cuts on lower income Americans. 

I remember a day in October 2010, when I visited both the Capital Hospice offices in Ballston and the Facility on 16th Street. I had worked in a life insurance company office building (at one time, United Services Life) that had been torn down on the site of the offices, and I had gone to elementary school at Woodlawn, which now houses the Hospice. For me, this had seemed like irony. I had taken first and second grades in the front atrium rooms of the building, now lobby and administrative areas, and other grades in parts of the building that now care for patients.  The current elementary school is half a mile away, on Glebe Road, up the hill.  

Today I heard again Josh Groban sing "You Raise Me Up", based on an Irish folk song "Danny Boy" (the subject of Stanford's Irish Rhapdsody #1). 

Tuesday, December 13, 2011

New site discusses history of assisted living facilities


There is a new site which gives a short but comprehensive history of Assisted Living Facilities, which started to develop in the 1970s.  The link is here
 
The story was recommended by email by Monica at the site.

The writeup talks about SNF’s (Skilled Nursing Facilities).  My understanding, from having worked on the New York State MMIS (Medicaid Management Information System) in the 1970s, was that SNF’s give skilled nursing care for people expected to get better (up to 20 days for full Medicare coverage and 100 days with Medigap), where as ICF’s (Intermediate Care) give custodial care and are not Medicare-covered. Many facilities offer both. 

But it is quite correct that Assisted Living facilities were developed to offer seniors with intermediate needs more privacy and more of a lifestyle. Some seniors carry on much of their former lives, and even have computers and Internet access.  Some are in AL for very specific disability-related physical care needs and can still function well or even have employment at home. 

Monday, December 12, 2011

During pension and retirement crisis, state legislators pad their pension pockets

USA Today has recently reported on the continued abuse by states of the pension system, and it has a chart of pensions paid to former state legislators, with a chart, at this URL.

Curiously, some smaller states don’t pay pensions to legislators, and California stopped pensions for legislators elected after 1990.   

But many states give their legislators perks that other state workers don’t get.  

Of course, it’s all too easy for legislators to pad themselves and get away with it, even in times when the country faces a retirement, pension and social security crisis.  It’s not clear from the chart what effect the pensions have (if any) on social security benefits.

Wednesday, December 07, 2011

Even with a trust, sometimes an executor appointment from a Probate court can be needed for special circumstances


More on trusts.  Sometimes, to satisfy the processing requirements of some  financial institutions (especially life insurance companies paying benefits where the beneficiary situation is murky), an executor needs to be appointed as such by a Probate Court in his city or county and state even though named as such in a trust.  Generally this should require the usual documentation (death certificate, originals of will and trust and signatures, identification), and payment of a processing fee and usually some taxes, typically low percentages.  But a sticky question could arise if the percentages applied to the entire estate, instead of only the portion that an institution questioned and demanded appointment for. 

So trusts may not do absolutely everything. 

Picture: the Far Left would like to outlaw all inherited wealth.