In his run for the presidency, Joe Biden laid out a “Plan for Older Americans” that reflected the Democratic party philosophy that healthcare and living with dignity after retirement are an inalienable right for all.
The Biden-Harris plan addresses long-standing inequities based on age and income when it comes to accessing quality, affordable healthcare and living in a financially secure retirement. This is critical because seniors are among the most vulnerable population in the United States from both a health and financial perspective.
Some of the key points President Biden’s plan makes that would improve the lives of older Americans and their families include:
- Prescription drug costs. As the plan articulates, Medicare should use its considerable bargaining power to reign in the expensive costs of prescription drugs. Also, allowing drug importation of lower cost alternatives from other countries would be covered. Bringing down these costs would have an immediate impact on the pocketbooks of seniors across the United States, many of whom struggle to make ends meet. Some are forced to choose between their medicine and food. They often address the high costs of prescription drugs by rationing care and dosage. They can’t afford their prescriptions and so either delay or avoid needed care, or they try to stretch out their medications to last longer. This practice is not healthy and actually exacerbates the costs of healthcare because their health declines instead of improving, which is ultimately more expensive for themselves and all of us
- Affordable health insurance. Providing affordable health insurance coverage to millions of Americans has been accomplished through the Affordable Care Act. 23 million lower income people are now covered, but there is still work to be done. President Biden vows to build on the program as it exists, finding ways to improve it and cover more people instead of repealing the act and starting over from scratch. Over the last decade since first enacted, the ACA has become embedded into the American healthcare system like Medicare and Medicaid have since the 1960’s.
- Social Security and Medicare. The long-term solvency of Social Security and Medicare must be addressed now before it’s too late. Social Security covers 70 million people and Medicare covers 61 million. The challenge is how to find revenues and cost savings to extend these programs without lowering benefits. Expect tax increases, possible increases or new formulas for eligibility ages, increased cost sharing for Medicare participants, but no decreases in benefits. Not only is this the third rail of politics, but it is the Gordian knot of our era that will require bold action to solve.
- Medicaid. 75 million people are covered by Medicaid. More and more seniors have come to rely on Medicaid to pay for their long-term costs covering more than 50% of all these costs for seniors. It’s imperative that the federal-state partnership that has funded and administered this program for decades continue to provide critical support for our most vulnerable populations. It will be important to offer tax incentives to encourage and reward people who seek private pay solutions such as long-term care insurance, life settlements and reverse mortgages as alternative funding vehicles so they don’t have as much need for Medicaid.
- Retirement savings. Creating greater incentives for people to save for the future with tax-advantaged retirement vehicles such as 401(k) accounts is necessary as this has become the 21st Century pension. Biden’s plan argues that the current system provides upper-income families a stronger tax break for saving than it does lower wage earners It’s a no-brainer to level this playing field so that lower-income workers and seniors who want to continue working and saving are not at a disadvantage. Every opportunity to encourage saving for the future, no matter how far off or how close, should be provided for all Americans.
There is no one magic bullet to address these issues. Access to healthcare and a dignified retirement comes from a mosaic of programs.
The combination of ACA, Medicare and Medicaid are all necessary to provide the broadest possible healthcare safety net for people at all ages and stages of life. The combination of protecting Social Security, tax-incentives for retirement savings, and programs designed to empower workers at all ages and income levels is how people will have the best shot at a financially secure and dignified retirement.
The Plan for Older Americans lays out a blueprint to get there, but doing so will take a rare mix of vision, political will and cooperation from both sides of the aisle.
Chris Orestis, President of LifeCare Xchange and known as the Retirement Genius, is a nationally recognized senior care advocate and expert in retirement, long-term care and specialty senior living funding solutions. The author of two books, numerous published papers and articles, and a frequent industry speaker; he is the innovator that brought the LTC Life Settlement into the market over a decade ago.
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