Fast Facts About Retiring in Maryland and District of Columbia
v The number of older persons are growing and living longer – in Maryland there are about 650,000 seniors (12 % of the total population) with 13 % in poverty; in District of Columbia there are about 63,000 seniors (11 % of the total population) with16 % in poverty. Many are women who depend on social security for most of their income.
v Company pensions and employer-sponsored are disappearing causing the difficult challenge of having people fund their own pensions and health care. Since 2000, 50% of employer-sponsored health care plans have ended.
v Social Security is not in crisis or broke – It is projected to deliver full guaranteed benefits until at least 2037 (38 years) and can pay 75 % of benefits for years after that.
o It is well-liked and managed and has administrative costs of less than 1% of its budget compared to private investment costs of 15%.
o It provides a cost-of-living adjustment to help keep up with inflation.
o Alternative private accounts will take funds out of Social Security decreasing its solvency.
v U.S. health care costs are rising faster than income, especially for seniors.
o Health insurance company profits have increased 1,084% in five years.
o Premium costs are rising three times faster than wages or inflation and are expected to double by 2016 unless we do something.
v Traditional Medicare, the nation’s largest and most financially efficient health system serving the needs of 40 million senior and disabled beneficiaries and their families is being eroded. In reality:
o Administrative costs average two percent compared with 5-6 percent cost in large private programs
o The partial privatization of Medicare through private plans (Medicare Advantage Plans) is costing the federal government 12-19 percent more than if Medicare administered these programs.
o Current law does not allow the Government to negotiate for better prescription drug costs and causes a significant gap in coverage for Medicare beneficiaries. Therefore, Medicare beneficiaries are spending about 20 percent of their income for health costs, particularly for prescription drugs. Medicare bargaining would cut costs and save $20 billion in tax dollars each year.
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