Wednesday, November 29, 2023

RPEC Weekly ACTION Newsletter – May 26, 2017

The Washington State Legislature is now in a second special session and there has not been much movement on a final budget deal. It is important however, that we keep the pressure on Legislators to prioritize retirees in their negotiations. Please continue to call (1-800-562-6000) and email your state lawmakers, asking them to contact their leadership and encourage that the PEBB Medicare restoration be maintained in the final budget.

This week HB 2114, protecting consumers from charges for out-of-network health services, passed  the House and will now head over to the Senate.  The good news is that it is moving.

Federal Concerns for Seniors

Disturbingly, this week seniors and especially public-sector retirees have serious concerns with news coming out of Washington D.C. Our ability to protect our retirement security depends on our knowledge so please pass this information on to others.

CBO Score on AHCA Indicates Increased Costs for Older Americans

The Congressional Budget Office’s (CBO) score of the American Health Care Act, the bill passed three weeks ago out of the House, is not good news for older Americans. In addition to the inclusion of the Age Tax, and reducing the funding for the Medicare Trust Fund, the nonpartisan CBO expects premiums for a 64-year-old earning $26,500 a year would increase by a whopping $14,400 in 2026 under the AHCA.  In addition, people with preexisting conditions may not even be able to purchase health insurance because the prices would be prohibitively high.

The CBO estimated that the federal deficit would be reduced by $119 billion over a 10-year period under the AHCA by steep cuts to Medicaid and the replacement of current subsidies with less-generous tax credits.   The bill would however, grant large tax cuts to pharmaceutical and insurance companies.

White House Budget Impacts Senior Programs

The $4.1 trillion budget sent by the White House to Congress on Tuesday includes roughly $2.5 trillion in cuts to “entitlement” programs over ten years. Both Congressional Republicans and Democrats expressed concerns. According to the Center on Budget and Policy Priorities, the majority of cuts will be from programs that help struggling families and elderly and disabled people afford the basics, like putting food on the table, keeping a roof over their heads, and affording health care. The cuts include:

·         Over $190 billion over the next decade in cuts to SNAP. These cuts would include shifting the cost of over $100 billion of SNAP benefits, a long-time federal responsibility, to states. Other cuts would target the elderly, working families, and the unemployed.

·         At least $1.85 trillion in cuts over ten years to the ACA and Medicaid. RPEC is very concerned about the impact on seniors who are in nursing homes and/or need in-home care losing Medicaid. Medicaid provides health coverage to more than 4.6 million low-income seniors, nearly all of whom are also enrolled in Medicare.

·         While the budget does not cut the “old-age payments” portion of Social Security, it will cut $72 billion from the Social Security Disability Insurance (SSDI).

·         The budget would eliminate all funding for Medicare State Health Insurance Assistance Programs (SHIP), known as the State Health Insurance Benefit Advisors (SHIBA) in WA. The program provides state counseling services that help seniors understand their Medicare, Medicare Advantage, Medigap (Medicare Supplemental Insurance) and Medicaid benefits. RPEC works jointly with the SHIBA. SHIP also helps guide enrollment in new plans and is the funding mechanism for 1-800-MEDICARE.

Public Sector Pension Attacks

Another sham organization, funded by the Koch Brothers, has been created to circulate false information about public pensions in an attempt to pit the average American against public employees. This time they are claiming that “strapped pension funds are eating hefty investment fees which will be dropped on taxpayers”.

Theresa Whitmarsh, Director of the Washington State Investment Board (WSIB), explains that private equity is one of our highest preforming asset classes and we have quite good controls in place since we have been in their class for 30 years. The WSIB negotiates fees aggressively, and determines each time an investment is made if we are getting “alignment of interest”. In addition we have a consultant to recalculate fees charged so we do not just rely on a manager’s assertion.

Public Pensions through the Department of Retirement Systems are the 7th best funded in the country and the WSIB generates 75 cents of every pension dollar paid out through investment returns.

Many states are not as lucky. According to the National Public Pension Coalition, public employees are under attack in Michigan, Kentucky, Pennsylvania, Kansas, Colorado, Oklahoma, and Oregon. Most have Governors, legislatures or commissions looking at converting the pensions into risky 401k’s. We will continue to stay engaged in the funding a preservation of the pension benefits we earned here in Washington.

If you have any questions or concerns, please contact the RPEC Office at 800-562-60970 or

                           Your Voice for Retirement Security!

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