Estimated 637,000 Arkansans will not receive Social Security Cost of Living Increase in 2010; 100,000 of them will also pay more for Medicare
Washington – U.S. Senator Blanche Lincoln (D-Ark.) today announced a comprehensive plan to help Arkansas’s seniors who face no annual cost of living increase from the Social Security Administration and rising Medicare premiums.
Cost of living adjustments are tied to the Consumer Price Index to protect the purchasing power of our seniors and to ensure their benefits keep pace with inflation. The index declined this year due to the weakening of the economy. As a result, Social Security payments for 2010 will not include a cost of living adjustment for an estimated 637,000 Arkansas seniors, veterans, and people with disabilities. Approximately 130,000 Arkansas seniors rely on Social Security as their only source of income.
Of the 637,000 Arkansans who will not receive a cost of living increase, more than 100,000 of them will also pay more for their Medicare Part B premiums, which are rising for 2010. Current law states that most Medicare beneficiaries do not have to pay the increased premium in any year in which they do not receive a Social Security cost of living adjustment (COLA). However, this law does not cover about one-fourth of Medicare beneficiaries who will be forced to pay the premium increase, estimated in Arkansas to be more than 100,000 people.
“For Arkansans on fixed incomes, the absence of an increase in Social Security benefits is extremely difficult,” Lincoln said. “Faced with the ever-increasing costs of health care, prescription drugs, energy and transportation that make up a disproportionate part of spending for seniors, they are also burdened with declining pensions and home values. I believe in the promise our government made to working Americans, that if we work hard, Social Security will be there to help us in our golden years. As Chair of the Senate Finance Committee’s Social Security Subcommittee, I will continue working to ensure that our seniors are not hit hardest by what would essentially be a cut in benefits, especially during times of economic hardship. I also believe we can do this in a fiscally responsible way that does not increase the deficit or negatively impact the Social Security program for current or future beneficiaries.”
To provide relief to our seniors, Lincoln, who serves as Chair of the Senate Finance Committee’s Social Security Subcommittee, is drafting legislation that would:
1. Provide $250 economic relief payments that would compensate Arkansans for the lack of a Social Security COLA increase. These payments would bring an estimated $160 million into Arkansas’s economy, helping an expected 637,000 Arkansans.
2. Ensure that Medicare beneficiaries do not see premium increases that would subsequently result in a decrease in their Social Security benefits.
3. Require the Bureau of Labor Statistics (BLS) to assess the merits of a price index that more accurately reflects true inflation for the elderly by taking into account their unique spending trends. The BLS would also be required to report to Congress on whether this index could or should be tied to the COLA for Social Security beneficiaries.
READ Senator Lincoln’s new county-by-county report detailing the number of Arkansans who would benefit from the $250 economic relief payments, the resulting economic impact on each county, and the number of Arkansans in each county who would be hit by rising Medicare premiums.
§ In Central Arkansas, over 129,410 Arkansans would receive approximately $32.4 million in one-time payments. Approximately 25,000 Central Arkansans will pay more for Medicare Part B.
§ In Southeast Arkansas, over 67,145 Arkansans would receive approximately $12.5 million. Approximately 16,000 Southeast Arkansans will pay more for Medicare Part B.
§ In Southwest Arkansas, over 80,330 Arkansans would receive approximately $19.3 million. Approximately 16,000 Southeast Arkansans will pay more for Medicare Part B.
§ In Northeast Arkansas, over 128,904 Arkansans would receive approximately $33.2 million. Approximately 26,000 Northeast Arkansans will pay more for Medicare Part B.
§ In Northwest Arkansas, over 194,630 Arkansans would receive approximately $47.7 million. Approximately 37,500 Northwest Arkansans will pay more for Medicare Part B.
