| Is there more to Social Security than a retirement benefit for me? The answer is YES. For the past few months, emphasis has been placed on Social Security retirement benefits. Some officials, some media, and others have focused their scare tactics on what might happen when we retire. Will there be enough money in the Social Security system to take care of us when we decide to retire? How about those of us who are already retired -- will our checks be reduced? Wha's ahead for us? Some of these questions were considered in my last month's column. This time, I move from "greedy geezers" -- selfish concerns about the amount of their retirement benefits to the other three major parts of the System. President Franklin D. Roosevelt, on Aug. 14, 1935, (gosh, 70 years ago) signed legislation authorizing the Social Security program. Later legislation added 1) survivors' benefits, 2) disability benefits, and 3) health-care benefits, also known as Medicare, for those 65 years or older. As a review, the following descriptions may be helpful: * Survivors' benefits are paid to the family of a worker who has died. They are like an insurance policy worth more than $350,000. Children under age 18 (or under 19 if still in high school) or a child 18 or older who becomes disabled before age 22 can get survivors' benefits. Also, a widow or widower 60 years or older or 50 or older and disabled may receive benefits. Workers who become severely disabled before reaching retirement age may receive a disability-insurance policy. Benefits are available if workers cannot do work they did before and cannot adjust to other work because of their medical condition. The disabling condition must be expected to last at least one year. Once benefits begin, they continue as long as the disability is present. Also, a worker who receives monthly payments for two years becomes eligible for Medicare. According to a July 27, 2005, news item in The Capital Times (in Madison), Social Security Commissioner Jo Anne Barnhart reported that clearly disabled persons could be approved for benefits in as few as 20 days under new procedures that will begin next spring. At present, the processes take many months before approval decisions are received, so that news is good. Medicare is the federal program that needs much more public attention than that paid to retirement benefits. Because of rising health-care and prescription-drug costs, the Medicare program faces immediate fiscal problems. It?s not like the retirement benefits program, whose concerns are years ahead of now. Each year, Medicare premiums paid as monthly deductions from Social Security retirement-benefits checks have increased. Most recent increases have been substantial. NOTE: Although the Social Security Administration is responsible for its administrative aspects, the Supplemental Security Income (SSI) program IS NOT part of the Social Security program called OASDI -- Old Age, Survivors, and Disability Insurance program. According to a March 2000 publication (#05-10080) by the Social Security Administration, of the amount paid in Social Security and Medicare taxes, 69 percent went to the trust fund for retirement and survivors? benefits, 19 percent to the trust fund for Medicare benefits, and 12 percent to the trust fund for disability benefits. Interestingly, administration costs were reported to be less than 1 percent. In contrast, estimates for health-insurance administrative costs range from 25 to 30 percent. Important questions about Social Security solvency were not discussed previously. One question asked by some politicos is: Should private (or personal) accounts be made part of the Social Security system contribution plan? Other alternatives reviewed by finance and other experts include raising the age of retirement, raising or eliminating the top limit of earnings subject to FICA (Federal Insurance Contributions Act), including income other than earnings under FICA provisions, and increasing the amount of contributions by program participants. Each of those and other possible alternatives have many arguments for and against them ? some social, some fiscal, and some personal preference. I plan to let others deal with such knotty questions. Even though the increasing monthly Medicare deductions are a financial concern, not much has been said about the fact that they are the same for all Social Security beneficiaries, regardless of the overall amount of each check. The social insurance part of the program appears to have been overlooked. Social Security benefit amounts are based on earnings and number of months of FICA payments. Medicare deductions from Social Security retirement checks are not -- and they are rising each year. And they're going to rise more and more unless health-care costs are better controlled. What's the answer? Is there any answer that is socially responsible? Shouldn't our state and federal representatives come up with a plan that will assure health care for all as a right, not a privilege for those who have money? |
| Is there more to Social Security than a retirement benefit for me? By Paul Kusuda |
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