Social Security a federal program that taxes workers to provide income support to the elderly

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1 Social Security a federal program that taxes workers to provide income support to the elderly Full Benefits Age The age at which a social security recipient receives full retirement benefits (primary insurance amount) Early Entitlement Age The earliest age at which a social security recipient can receive reduced benefits. unfunded refers to retirement plans in which payments collected from today's workers go directly to today's retirees, instead of being invested in order to pay future benefits. Privatization a proposal to reform Social Security by allowing individuals to invest their payroll taxes in various assets through individually controlled accounts. Ida May Fuller First American to receive a monthly benefit Social Security check. She received the check, amounting to $22.54, on January 31, 1940 Problems with SS Social Security is an "unfunded" income transfer scheme the benefits paid out to retirees are financed by taxing the current income of working people. It is not a "funded" approach, where an individual's taxes would be invested, and the proceeds used to provide their retirement benefits (like an IRA or a 401k). Unemployment Insurance A joint state-federal program under which state-administered funds pay a weekly benefit for a limited time to eligible workers when they are involuntarily unemployed. Worker's Compensation A government-regulated program that provides medical benefits and income to employees who are injured on the job. Coverage is no fault insurance and entirely paid for by employer. Medicare A federal program of health insurance for persons 65 years of age and older

2 Medicaid A federal system of health insurance for those requiring financial assistance. social insurance programs government interventions in the provision of insurance against adverse events means-tested refers to programs in which eligibility depends on the level of one's current income or assets. actuarially fair premium an insurance premium that is set equal to the insurer's expect payout Food Stamps to SNAP -negative connotation -no longer paper now electronic -food stamps supposed to provide ALL benefits that you need to buy food for that month -SNAP shows that it is to supplement foods--different levels of support Food Stamp Act of President Johnson: FSP became permanent -recipients paid for food stamps (paying the average money they spent on food) & received an amount of food stamps that was determined to help them to have a nearly nutritionally complete diet --could use food stamps to buy "all items intended for human consumption" except alcoholic beverages and imported foods Food Stamp Act of 1977 Major overhaul of program, eliminated purchase requirement bc of barrier to participation the requirement represented entitlement program everyone who qualifies can get it ex) SNAP nonentitlement program certain amount of funding--when the funding is utilized, can no longer accept new clients ex) WIC

3 SNAP -the U.S. department of Agriculture administers the Food Stamp Program at the Federal level through its Food and Nutrition Service (FNS) -state agencies administer the program at State and local levels, including determination of eligibility and allotments, and distribution of benefit What is SNAP for? Households must meet eligibility requirements and provide info-and verification-about their household circumstances -US citizens and some aliens who are admitted for permanent residency may qualify Welfare Reform Act of 1996 ended eligibility for many legal immigrants -congress later restored benefits to many children and elderly immigrants, specific groups -placed time limits on benefits for unemployed, able-bodied, childless adults Demographic Characteristics of SNAP participants Children w Single Parents (27%) Adults without Children (18%) Children with Multiple parents (15%) Adults living w other Adults and children (13%) Single parents (13%) Elderly (8%) Child Only (6%) To participate in SNAP Households may have no more than 2000 in countable resources, such as a bank accounts (checking & savings) if one person in house is 60 or older or disabled --items not cash accessible, (household home, personal property, retirement savings & vehicles don't count) Gross monthly income of households 130% or less of Federal poverty guidelines --monthly NET income 100% or less of Federal poverty guidelines

4 Who is not eligible for snap? -some people not regardless of their income or assets, such as: individuals who are on strike, all undocumented immigrants, and certain immigrants -unemployed childless adults who do not have disabilities are limited to: 3 months of SNAP benefits every 3 years in many areas of the country --> time limit currently temporarily waived in most states bc of high unemployment Households CAN use food stamp benefits to buy (SNAP) foods for the household to eat: breads and cereals fruits and veg meats, fish, poultry dairy products seeds and plants which produce food for the household to eat Households CANNOT use food stamp benefits to buy nonfood items: pet foods soaps, paper products household supplies vitamins and medicines food that will be eaten in the store hot foods Thrifty Food Plan -provides a representative healthful and minimal cost meal plan that shows how a nutritious diet may be achieved with limited resources -a fundamental part of the US food guidance system and the basis for maximum food stamp allotments Thrifty Food Plan Cont -last updated in 2006 with 2005 Dietary Guidelines for Americans & the 2005 MyPyramid -uses the prices low-income people paid for many foods (Nielsen Homescan) -uses latest data on food consumption, nutrient content, and food prices -National Health and Nutriton Exam Survey -Food Price Database of the Consumer Price Index TFP "market baskets" specify the type and quantity of foods that people could consume at home to obtain a nutritious diet at minimal cost -15 market baskets for 15 specific age-gender groups

5 Medicare Part A Financed by a trust fund referred to as the Hospital Insurance Fund (NOT adjusted) Medicare Part B Supplemental Medical Insurance Trust Fund (SMI Fund) - Beneficiary premiums + general tax revenues = fund Part B (ADJUSTED annually) Medicare Financed by employer & payroll taxes - administered by federal government - NOT allowed to negotiate prices w/ drug companies Medicaid Program for people who meet the MEANS TEST (the poor) - Paid for by general tax revenues NOT out-of-pocket - Enacted as part of Social Security ACT Medicare Part C ADVANTAGE - Medicare pays the private health plan a Capitated Rate (Set amount, every month for each member) Medicare Part D Established by Medicare Prescription Drug Improvement & Modernization Act - Benefit administered by private insurance plan (PDP or MD) or reimbursed by Center for Medicare/Medicaid Services (CMS) - Multiplicity of plans available Deductible Amount of money needed to be paid before insurance can start paying the rest Co-Payment Out-of-pocket payment such as a $30 payment made for a doctor visit, shapes consumer behavior Medication Therapy Management Services May be furnished by pharmacists OR other qualified health professional (Lower costs & increased quality is the goal) Formularies List of drugs insurance companies / hospitals will pay for - Help control costs for hospitals / insurance companies - NOT smart to carry several different drugs that treat same illness Tiered Co-Payment Higher you are from the FPL the higher your co-pay b/c it is affordable to you (Prescription drug plans can set formulary usually based on these)

6 Overriding Formularies Can be done by doctors w/ prior authorization and good rationale Medication Action Plan Consult w/ physicians & change prescriptions to patients to REDUCE costs, INCREASE quality, & REDUCE adverse affects Shared Cost Saving (Accountable Care Organizations) One Side & Two Sided model One Sided Model Participate in shared savings in the first two years, and in the third year participate in shared losses along with shared savings Two Sided Model Participate in both shared savings & losses in all three years