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Newly
released 2009 COLA forecast would keep five
million Seniors below poverty line...2.8
percent increase would raise average benefit
just $30.20 per month during economic
downturn
WASHINGTON, Feb. 14
/PRNewswire-USNewswire/ -- Late last month,
the Congressional Budget Office published a
little-noticed estimate that forecasts
seniors will receive just a 2.8 percent
increase in their Social Security checks Late last month, the Congressional Budget Office published a little-noticed estimate that forecasts seniors will receive just a 2.8 percent increase in their Social Security checks beginning in January, 2009.
beginning in January, 2009.
Despite the increase,
at least five million people aged 65 and
over will remain in poverty, since senior
costs are rising significantly faster than
the annual Social Security Cost of Living
Adjustment (COLA).
Between 2001 and 2008,
Medicare Part B premiums have soared by more
than 93 percent while the COLA has crept up
just 19 percent, leaving many seniors on
their own to cover all other rising costs.
Part B premiums cover doctors' visits,
tests, and outpatient hospital care.
Although the COLA is
intended to help seniors keep up with
inflation, a recent study by The Senior
Citizens League (TSCL) that analyzed eight
key expenditures found that people 65 and
over have lost 40 percent of their buying
power since 2000.
Expenses such as home
heating oil and gasoline have more than
doubled since the beginning of the decade,
while food staples such as potatoes and
butter have increased by 47 and 39 percent,
respectively.
A majority of the 48
million Americans aged 65 and over who
receive a Social Security check depend on it
for at least 50 percent of their total
income, and one in three beneficiaries
relies on it for 90 percent or more of their
total income.
"Social Security is
supposed to protect seniors in need -- but
with five million seniors below the poverty
line, it's clear the system is failing
them," said Shannon Benton, executive
director of The Senior Citizens League.
"If it's true that a
nation's greatness is defined by how well it
treats its most vulnerable citizens, then we
must do a better job of protecting
impoverished seniors."
To help offset the cost
of Medicare Part B, TSCL is lobbying for a
change in the Consumer Price Index (CPI)
used to determine the COLA.
The government
currently calculates the COLA based on the
CPI for Urban Wage Earners and Clerical
Workers (CPI-W), a slow-rising index that
tracks the spending habits of younger
workers who don't spend as much of their
income on health expenditures.
However, the government
also tracks the spending patterns of older
Americans with the CPI for Elderly
Consumers, or CPI-E. By tying the annual
increase in the COLA to the CPI-E, seniors
would see much needed relief in their
monthly checks.
For example, a senior
who retired with a benefit of $460 in 1984
would have received almost $11,200 more over
the past 24 years with the CPI-E.
TSCL supports two
similar bills in the current Congress, H.R.
1953 and H.R. 2032, entitled "The Consumer
Price Index for Elderly Consumers."
With 1.2 million
supporters, The Senior Citizens League (www.SeniorsLeague.org)
is one of the nation's largest nonpartisan
seniors groups. The Senior Citizens League
is a proud affiliate of The Retired Enlisted
Association.
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