Retirement confidence falls to all-time low

March 21, 2011March 21, 2011 J Roberts

A recent survey reveals that most Americans still don’t save enough for retirement. If the facts are correct, it appears that the majority of Americans will be working well past the age of 65.

By Larry Barrett

March 16, 2011

Most Americans still aren’t saving anywhere near enough money to afford the dignified retirement they all claim is so important to them. Even worse, most don’t even have any idea exactly how much they’ll need if they were to begin saving today for their golden years.

That’s the sobering truth derived from the 21st installment of the Employee Benefit Research Institute’s Retirement Confidence Survey (RCS) released Tuesday.

The only good news, according to Jack VanDerhei, research director of the Washington, D.C.-based EBRI, is that the majority of Americans are rightfully ignoring short-term economic improvements in the stock market and unemployment rates following several years of dismal performance. They now recognize that they are woefully behind the eight-ball in terms of properly planning and saving for their eventual retirement.

“There are many big, systemic factors redefining retirement in America today,” VanDerhei said during a conference call with reporters. “People are starting to wake up to this reality and changing their expectation of retirement. Unfortunately, the survey doesn’t find any evidence that people are changing their behavior — at least not yet.”

The RCS survey, conducted by market research firm Mathew Greenwald & Associates, found that more than half of the 1,260 respondents surveyed in January 2011 are “not all confident” or “not too confident” that they’ll be able to afford the retirement they want, the lowest level of confidence among workers in the survey’s 21-year history.

One of the main reasons so many people are so pessimistic about their retirement prospects is the simple fact that far too few workers are actually saving for retirement.

Currently, most Americans can expect an average retirement of about 20 years, and that number continues to expand as people live longer, while at the same time incur higher medical and cost-of-living expenses.

The survey found that the folks with savings of less than $25,000 are the most petrified about retirement and essentially resigned to the fact that they’ll either work throughout most of their retirement or never really experience one at all.

Forty-three percent of respondents with savings of less than $25,000 said they are not confident they’ll have enough money to afford a decent retirement, up from 19% in 2007.

Meanwhile, 22% of those with between $25,000 and $100,000 in savings remained less-than-confident about their retirements, more than triple the 7% who felt the same way in 2007.

This changing perception reflects not only most Americans’ disinterest in saving for tomorrow, but also the stark reality that most people aren’t expecting things to magically improve between now and the time they hit retirement age.

“Sixty-two percent of workers said they can save more than they’re saving now,” said Greenwald. “Most said they could dine out less, cut back on entertainment and, in some cases, wouldn’t really need to cut back at all to increase their savings. And while the sacrifices wouldn’t be that great, many still haven’t formed the habit of doing it.”

That so few have taken the time to reasonably figure out how much they’ll need to take that cruise to Alaska or keep them in prescription medications for 25 years or more speaks to just how invaluable retirement planning advice will be to this growing population of skeptical, unprepared workers.

Perhaps most depressing, the survey found that the percentage of workers who expect to retire after age 65 continues to increase, growing from 11% in 1991 and 20% in 2001 to a stunning 36% in 2011. Also, 74% of workers said they expect to have work for pay in retirement, more than triple the number (23%) of current retirees who are now working because they need the income.

“Even those who have achieved the highest levels of accumulation already, with more than $100,000 in savings, won’t be able to maintain the lifestyle they’re currently enjoying in retirement,” Greenwald said. “High accumulators still haven’t come to that reality. And 70% of all workers say they’re behind schedule when it comes to saving for retirement.”

“The bigger problem is that most haven’t changed their behavior and turned this pessimism into action to catch up,” he said.

Medical bankruptcies a continuing problem, study finds

March 14, 2011 J Roberts

A recent survey reveals that medical bankruptcies continue to plague families in Massachusetts.

The Boston Globe

Kay Lazar, Globe Staff

The 2006 Massachusetts law that required nearly everyone to buy health insurance has not significantly staunched residents’ pain from medical bankruptcies, according to a new study.

A survey of Massachusetts residents who filed for bankruptcy in July 2009 found that 53 percent cited a medical cause, down from 59 percent who blamed a medical cause in a survey done in early 2007, before the state law had been fully implemented. But because of the small number of people surveyed, the difference was not statistically significant, according to the study in today’s American Journal of Medicine.

Lead study author Dr. David Himmelstein said medical bills are still causing bankruptcies because health costs in the state have continued rising sharply. High premium costs, along with large co-payments and deductibles, often expose families with insurance to substantial out-of-pocket costs, said Himmelstein, a professor of public health at City University of New York.

“People think they have reasonable insurance until they try and use it,” Himmelstein said. “You are carrying an umbrella and it starts to rain and you put it up and it’s full of holes. For most people, it just hasn’t rained yet.”

Himmelstein, who conducted the research while working as an associate professor of medicine at Harvard Medical School, is co-founder of Physicians for a National Health Program, an organization that pushes for national health insurance.

He said his findings suggest that the national health overhaul, which was largely modeled on the Massachusetts law and will take full effect in 2014, will not ease the number of medical bankruptcies, either.

AARP survey finds N.J. seniors are facing financial, health care hardships

March 7, 2011March 7, 2011 J Roberts

A recent survey by AARP reveals that many NJ senior citizens are having a hard time meeting their financial obligations and getting adequate health coverage. Healthcare costs continue to rise and benefits are shrinking. The fear is real as more and more seniors find themselves working well into their golden years in order to support themselves. Read the below article and review the survey.

Peter Van Ness used to be the picture of financial health: perfect credit scores, quick to pay down his credit cards, never late on bills. During 50 years of work, he said, not once did he need help making ends meet.

But he could use some help now.

“I am being buried,” said Van Ness, 67, of West Milford, who still works but must pay for his bedridden mother’s medical expenses, has three kids in college and won’t be getting any retirement benefits from his company.

“I have real problems even trying to supply food for the family,” he said. “Whoever said the golden years are your best years — I laugh like hell.”

Van Ness was one of 400 New Jersey residents over age 50 polled for a survey to be released today by the AARP. Like him, many of the respondents said they’re having a hard time meeting their financial obligations and getting adequate health coverage. About two-thirds said they don’t have all the resources or information they need to stay healthy, and three in four said they worry about the levels of Social Security and Medicare benefits.

“It shouldn’t be surprising that there’s real palpable fear out there because seniors are suffering,” said Douglas Johnston, legislative director for AARP-NJ. He said the state’s utility costs, for example, have risen for the last five or six years while Social Security payments, a major source of income, have remained flat the last two years.

“I frankly don’t know how they do it,” he said. “The median amount Social Security recipients get per year is $10,400. How do you live on $10,400 anywhere, especially an expensive state like New Jersey?”

Harry Padden of Irvington, 58, is nearing retirement from his job as an inspector for the U.S. Department of Housing and Urban Development, but he fears his pension may be cut before he leaves and said he’s already paying more for health care.

“I’m squeaking through paying my bills,” he said. “I’ve considered moving to Georgia or Florida — there’s higher wages and it costs you less. My daughter has indicated that if I go, she’s going to follow.”

The survey also found 84 percent of residents would prefer to get long-term care at home or in an assisted-living facility, as opposed to a nursing home. Johnston said the state could save money by investing more in home-based care, which he said costs one-third of what nursing homes cost.

“It gives people what they want, we’ve never met a legislator or governor who doesn’t agree — and yet it never seems to happen,” he said.

The AARP survey also asked New Jerseyans over 50 what they most want to do in their retirement years. Forty-two percent said travel, 23 percent said they would focus on hobbies and interests, 8 percent mentioned their jobs or careers and 6 percent said they would devote themselves to their families.

Though he talks of moving, Padden said spending time with his family was a major reason he’s still in New Jersey.

“My grandson is in a basketball team, and I don’t really miss a game,” he said. “I’m driving over now.”

Consumer group says spending caps in national healthcare law will bring relief to people seeking medical care

March 2, 2011 J Roberts

There could be relief for out-of pocket costs under the Affordable Care Act (ACA). Under the act, out-of-pocket costs will be capped at a certain dollar amount. Hopefully, this will protect consumers from increased debt and potential bankruptcies due to exorbitant medical bills.

Los Angeles Times

It’s a well-known complaint among consumers and healthcare advocates: The soaring cost of medical care is forcing millions of Americans to drain their savings, run up credit card bills, declare bankruptcy or lose their homes to foreclosure.

A report out Tuesday that examines the problem in California says the nation’s year-old healthcare law –- currently under assault by congressional Republicans — would help protect people in the Golden State from financial catastrophe.

In its study, the consumer group Families USA points out that the law would cap how much people with insurance must spend out of their pockets for healthcare services, starting in 2014.

If the law were to take effect this year, the group says, the caps would be $5,950 for an individual and $11,900 for a family of any size. Low-income people would pay less than higher earners.

More than 1.9 million Californians would exceed the spending caps if they were in place this year, the group reports. That extra spending would surpass the caps by more than $3 billion.

Once the new spending limits are in place in 2014, insurance companies will have to pick up the tab for essential medical services -– including the costs for doctors, hospitals, prescription drugs and emergency care — after consumers pay their share.

“These new out-of-pocket caps will protect families from catastrophic medical costs when illness or [an] accident strikes,” the report states.

The spending caps will apply to health insurance plans sold through new insurance exchanges scheduled to open in 2014 in California and other states. The limits also will apply to new insurance plans sold to individuals and small businesses outside the exchanges.

In addition to the report on California, Families USA produced data for other states. To read the reports, go to http://www.familiesusa.org/resources/publications/reports/health-reform/out-of-pocket-caps-states.html.

Major Reforms in Student Insurance Proposed

February 21, 2011 J Roberts

Looks like there may be some hope for college students regarding insurance coverage. In an area that has long been neglected, Congress has now introduced new regs to the Affordable Care Act which will require colleges and universities to provide health insurance coverage to students.

By Ria Patel

In quest to make lives of University students better, the Congress has decided to introduce new plans in the existing health care law, which will be in effect from the next year.

The reforms proposed, will be in favor of college students, who have estimated number of 3 million at present.

Till now, the area of student insurance was widely neglected, partly because of its uncertain and short validity duration.

But now after, bringing the student health insurance plans offered by colleges and universities to the same level as that of the 2010 federal Affordable Care Act by the U. S. Department of Health and Human Services, the need for further amendments is strongly felt.

The new reforms will ask colleges and universities to provide the health insurance to students, even if they are less than 18 years or have underlying medical conditions like diabetes or other discrepancies.

The law will also take care of benefits borne out of student plans. The schemes, which currently have very less boons, will observe a boost to minimum of $100,000 before September 2012 and more than $2 million after that.

The Universities will also be asked to maintain the coverage, in case the student is down with ill-health. No student will be punished if he forgets to give a proper account of its medical history.

Meanwhile, the Health and Human Services Department has sought public comments and views on proposed amendments till April 12.

Californians Bracing to Pay More For Health Care

February 8, 2011 J Roberts

It’s 2011 and healthcare costs continue to rise. California’s are bracing themselves for large increases in their medical insurance costs. Unfortunately, California is not the only state. The winds of rising healthcare costs and insurance premiums traditionally blow from West to East.

Anita Vogel

It’s the perfect storm in California when it comes to rising health care costs, with millions bracing for huge increases in their monthly insurance bill. What’s happening? The Golden State is one of many states that doesn’t allow for rate regulation. In addition, California is home to most all of the big insurance companies and the largest market of uninsured people. At the same time major insurers are racing to beat a July 1st deadline requiring these companies to publicly justify their rate hikes.

So, what the people of California are left with are massive increases in their health insurance premiums, to the tune of nearly 60 percent when it comes to Blue Shield in particular. Just today they caved in to public pressure and agreed to join every other insurance company in California like Aetna, Anthem Blue Cross and Pacificare to wait sixty days to raise their rates, but there’s little doubt those rate hikes are still coming later this spring.

In the meantime economists say the tough economy is also playing a role in causing insurance companies to raise their premiums. “Healthy people are dropping out of insurance,” says Dr. Neeraj Sood of the University of Southern California, ” and what happens then is it is basically the unhealthy people who are left with insurance and they cost much more and therefore premiums have to rise.”

But patients are not the only people affected by rising prices; Doctors are also feeling the heat. Dr. Mark Weiss, a long time podiatrist in Century City, California, is also a victim of bigger health care bills. “About a year and a half ago, I opened up my mail and there was a 600 dollar a month increase in my premiums for a policy that was less than good,” says Weiss. His Anthem Blue Cross coverage had gone up more than 20 percent, at the same time his patients were experiencing huge rate hikes. As a result, some of his patients dropped their insurance coverage and Weiss and other area doctors say they had little choice but to concentrate on patients who pay cash for their visits. “My overhead keeps on going up, my reimbursement goes down and that is why a lot of the doctors in the community don’t take any insurance,” adds Weiss.

And as insurance companies gear up for the new federal health legislation to take effect in 2014, many expect they’ll continue to raise their rates, out of concern for how the rules might change in the future. That prospect has patients around the nation worried what that means for them.

Ely Zimmerman, who is a regular patient of Doctor Weiss admits he knows many who have thought of taking their chances and dropping their health insurance all together, but says he won’t do that. “I can’t go without health insurance,” says Zimmerman. “You hear stories of friends who have heart attacks or strokes, so you can’t be without health insurance, I feel like there’s no choice.”

More Americans oppose health-care law, but few want a total repeal

January 31, 2011January 31, 2011 J Roberts

The nation still appears divided over the Affordable Care Act. According to the below Washington Post article, a recent poll by ABC shows an even split over those in favor of the law and those who want a total repeal. What’s your position? We’d like to know.

Jon Cohen

The Washington Post

Republican claims that the new health-care law will hurt the country’s fragile economic recovery and inflate the deficit resonate with the public, according to a new Washington Post-ABC News poll. But few opponents of the law advocate an immediate, wholesale repeal of the legislation.

Overall, Americans’ views of the sweeping health-care overhaul, again under debate on Capitol Hill, remain firmly entrenched, with little change in stiff partisanship on the issue. Some 45 percent of those polled support the law, and 50 percent oppose it, numbers that exactly match their averages in Post-ABC polls going back to August 2009.

Three-quarters of Democrats support the new law, and 80 percent of Republicans oppose it; both are within a few points of their long-term averages. Independents tilt against the legislation, just as they have in most previous polls.

Republicans surveyed in the poll overwhelmingly see negative consequences if the law remains unchanged: 80 percent say it is likely to hurt the economy, 78 percent say it will increase the deficit, and 67 percent say it is apt to cost the country jobs. On each of these points, a majority of independents also take the pessimistic view.

On the economy generally and on jobs, most Democrats see long-term positive effects of the current law. But on the deficit, they divide down the middle, with 46 percent saying the law is more likely to increase the federal budget deficit and 46 percent saying it is more apt to decrease it.

Despite the relative popularity of the detractors’ arguments, there is still little consensus among opponents about the right approach to amending the legislation.

Those who do not support the law are split about evenly between advocating for its complete repeal (33 percent), a partial repeal (35 percent) and a wait-and-see approach (30 percent). Fully two-thirds of all Republicans say they want the law repealed, at least partly.

Recent polls on repeal yield very different answers depending on how the question is asked and how many answer categories respondents are offered. In every iteration of the question, a relatively split verdict on the law appears intact.

As reported Monday, for the first time in Post-ABC polling, congressional Republicans are now tied with President Obama on the question of whom the public trusts when it comes to dealing with health-care change. Overall, 43 percent of Americans approve of the way the president is handling the issue, matching a career low; 52 percent disapprove.

Another factor in the debate is that a quarter of those who oppose the health-care law say the legislation is faulty because it did not go far enough, not because it pushed change too far.

The poll was conducted by telephone Jan. 13 to 16, among a random national sample of 1,053 adults. The results from the full poll have a margin of sampling error of plus or minus 3.5 percentage points.

Single Payer System Takes Center Stage in Vermont

January 17, 2011 J Roberts

Looks like single payer healthcare coverage is very much alive in Vermont. Even though the national public outcry over a single payer system, deemed as socialized medicine, is very much real, Vermont is not the only state exploring and looking for alternatives to curtail the unsustainable rise in healthcare costs. The article makes good points about those who have no insurance and those that are underinsured with only the basic minimum coverage.

Vermont Public Radio

While healthcare reform came under fire in many parts of the country, a single payer system is very much on the horizon in Vermont.

Vermont’s new governor-elect Peter Shumlin makes the case for a single payer system first and foremost as an economic issue based on the trajectory of cost increases for the state, employers and individuals. Shumlin campaigned on a platform that calls for implementation of a single payer system, with benefits that follow the individual and are not a requirement of the employer. The system would reimburse based on outcomes rather than fee for service using technology for medical records and payment. It would also eliminate private insurers and their administrative costs.

Earlier this year, Harvard Economics Professor William Hsiao, an expert on health care systems, was commissioned by the Vermont legislature to develop implementation plans for healthcare system options including a single payer system. In a New York Times interview, Hsiao contends that “you can have universal coverage and good quality health care while still managing to control costs. But you have to have a single-payer system to do it.”

Vermont would require a waiver from the federal government to implement a single payer program. Shumlin is already lobbying President Obama about this waiver. According to Shumlin, “the waivers is the easy part. The hard part is designing a single payer health care system that works and that delivers quality health care, gets insurers off our providers’ backs, has a reimbursement system that makes sense. … I believe if we design that system, we can sell it.”

There is solid evidence to back up Shumlin’s belief. Exit polls tallied 59% of Vermont voters either backing national health care reform as-is (16%) or backing expansion of reform (43%). And with the Vermont executive and legislative branches firmly controlled by one political party, there is the very real opportunity for a viable single payer system to be enacted.

According to Shumlin, “in Vermont, the cost of health care is estimated to increase by $1 billion from 2010 to 2012. For the average Vermont family of four that’s a $7,000 increase on top of the $32,000 that we now spend for health care coverage each year. Our rate of increase exceeds the national average. It is not sustainable. Health care costs are crippling our economy, hampering business growth, driving up property taxes, and bankrupting too many individuals. These costs must be brought under control. The only way to do this is for the state of Vermont to lead the nation in comprehensive health care reform. 47,000 Vermonters have no insurance. When these Vermonters become sick, they are faced with a choice—seek the care they need and risk bankruptcy, or avoid care and face debilitating health or even death. When they do choose to seek care, it is the insured that pay for it. This is an unacceptable choice in a civilized society. It also imposes ethical dilemmas on health care professionals trying to treat the uninsured. Unfortunately, this problem isn’t confined to the uninsured. Tens of thousands of Vermonters are underinsured. All too often Vermonters don’t get the care they need because of unaffordable deductibles, co-pays, and coinsurance.”

Va. Judge Says Healthcare Reform Law Is Unconstitutional

January 11, 2011January 11, 2011 J Roberts

HFMA

Could be trouble for the Obama administration and Healhcare in general if the December 12 ruling by Federal Judge Hudson is upheld. Whatever the decision, 2011 will prove to be a year of polemics and intense debates as healthcare will be at the top of the political agenda.

A federal district judge in Virginia ruled on December 12 that the individual mandate, a key provision of the Affordable Care Act, is unconstitutional. The action today marks the first time that any court in the country has ruled to invalidate any part of the legislation. However, according to Virginia Judge Henry E. Hudson, there should be no immediate effect on the ongoing rollout of the law.

In a 42-page opinion, Judge Hudson wrote that the law’s individual mandate to buy health insurance exceeds the regulatory authority granted to Congress under the Commerce Clause of the Constitution. The judge wrote that his survey of case law “yielded no reported decisions from any federal appellate courts extending the Commerce Clause or General Welfare Clause to encompass regulation of a person’s decision not to purchase a product, not withstanding its effect on interstate commerce or role in a global regulatory scheme.”

Obama administration officials said they are confident that the law eventually will be upheld and stressed that any actual impact on the law would be deferred for years. They noted that the insurance requirement does not even take effect until 2014, when the Supreme Court presumably will have ruled.

HHS Issues Regs on Insurance Rate Increase Disclosure and Review

January 3, 2011 J Roberts

Read about the regulations concerning the new Affordable Care Act. Insurers will now have to justify any large or significant rate increases.

New proposed Affordable Care Act (ACA) regulations announced today by the U.S. Department of Health and Human Services (HHS) are intended to bring new transparency and scrutiny to proposed health insurance rate increases. These proposed rules allow HHS to work with states to require insurers to publicly disclose and justify unreasonable rate increases.

The ACA has already begun to help states strengthen or create rate review processes, HHS said. On August 16, HHS awarded $46 million to 45 states and the District of Columbia to help them improve their oversight of proposed health insurance rate increases. This is part of $250 million that the healthcare reform law makes available to states to take action against insurers

Today’s proposed regulations will build on these efforts by requiring insurers in all states to publicly justify any unreasonable rate increases beginning in 2011, as described in an HHS fact sheet. In 2011, proposed rate increases of 10 percent or higher will be publicly disclosed and thoroughly reviewed to determine if the rate increase is unreasonable. After 2011, state-specific thresholds would be set using data and trends that better reflect cost trends particular to each state. An insurance company’s justifications for unreasonable increases will be posted on HealthCare.gov and the insurance plan’s website.

Under the proposed regulation, states with effective rate review systems would conduct the reviews. If a state lacks the resources or authority to do thorough actuarial reviews, HHS would conduct them. Meanwhile, HHS will continue to make resources available to states to strengthen their rate review processes.

In 2014, the ACA empowers states to exclude health plans that show a pattern of excessive or unjustified premium increases from the new health insurance exchanges.