We have 1 Action Item today at issue 2
Summary of Issues
At Issue 1. we see NO COLA IN 2016. You’re paying for lower gas prices. It’s official: there won’t be a 2016 COLA for people collecting military retired pay, Social Security, VA compensation, or survivor benefits. (See Issue 1 below for the details. GF)
At Issue 2. we see WILL YOU PAY (LOTS) MORE IN PART B PREMIUMS? Jarring hike for some beneficiaries. Despite no COLA next year, 7 million Medicare beneficiaries will see steep increases. (See Issue 2 below for the details and to send an Email to our legislators. GF)
At Issue 3. we see AGENT ORANGE SCAPEGOATING. VA provision lapses. Lawmakers are leaving VA Secretary Bob McDonald in difficult position. (See Issue 3 below for the details. GF)
Collectively We Can and Are Making a Difference
FOR ALL, Please feel free to pass these Weekly Legislative Updates on to your group of Veteran Friends –
don’t be concerned with possible duplications – if your friends are as concerned as we are with Veteran issues, they probably won’t mind getting this from two or more friendly sources
ISSUES
Issue 1. NO COLA IN 2016
October 16, 2015
The Bureau of Labor Statistics (BLS) released the September inflation figure this week and confirmed what most retirees already knew – there won’t be a cost-of-living adjustment (COLA) in 2016 for people collecting military retired pay, Social Security, VA compensation, or survivor benefits.
Falling gas prices are a key reason why the inflation index (and your COLA) tanked over the summer.
Retired pay increases are made each year to maintain the same level of purchasing power each servicemember had at retirement. This is accomplished through annual COLAs, which are based on the BLS’ Consumer Price Index (CPI) – the measure of inflation.
While most COLA increases are automatic, Congress must approve COLAs for veterans every year. This is largely so lawmakers can return to their home districts and say they did something for local constituents.
One question we get every year is “Why is the retired pay COLA (higher or lower) than the active duty pay raise?”
The simple answer is they’re tied to different things. COLAs are tied to changes in consumer prices, whereas active duty pay raises are (supposed to be) tied to the average American’s pay growth, as measured by BLS’ Employment Cost Index (ECI).
In many years from the mid-1970’s through the mid-90’s, COLAs were higher than active duty pay raises, primarily because active duty pay raises were capped below the ECI.
The track record for keeping annual retired pay COLAs up with the CPI has been far better, in part because inflation has been relatively low for many years.
In the late 1990’s, chronic retention problems (from all those years of pay raise caps) led Congress to plus up active duty pay, so those raises were larger than COLAs from 1997-2005. More recently, the retiree COLA has exceeded the pay raise percentage in two of the past three years.
So what happens now, and what’s the implication for the 2017 COLA?
Because inflation for the full fiscal year actually declined by 0.4 percent, that means we’ll start 0.4 percent in the hole in measuring cumulative inflation for the January 2017 COLA.
Issue 2. WILL YOU PAY (LOTS) MORE IN PART B PREMIUMS?
October 16, 2015
70 percent of Medicare beneficiaries will be happy to know they won’t see a Medicare Part B premium increase in 2016. If you’re paying $104.90 a month in 2015, you’ll pay the same next year (unless you had a big jump in your 2014 income—see below).
But it’s quite another story for the other 30 percent, who will see a 52 percent hike over what they’re paying now.
How can this happen?
The law says, in years when there’s no Social Security COLA, Part B premiums can’t be raised, either.
But that protection doesn’t apply to everybody. The law doesn’t protect the following groups:
· new Medicare enrollees in 2016 (who aren’t grandfathered because they never paid the lower premium);
· Medicare enrollees with incomes above $85,000 a year ($170,000 for a married couple), who already pay premiums higher than the basic $104.90; and
· people who suspended or delayed their Social Security benefits (your Social Security check can’t be protected against reduction if you’re not getting a check).
So why the huge 52 percent increase for these non-grandfathered groups?
While one part of the law protects the 70 percent from premium hikes if there’s no COLA, another says total premiums collected still have to cover the same total amount that would be collected if there were no grandfathering.
For 2016, that means premiums for the unprotected 30 percent must be raised enough to cover the grandfathered people’s share, too.
That’s the law.
The chart below shows how much that will change 2016 premiums for the various groups.
For the first line of the chart, the only people who will be hit with the $159 premium are those who will enroll in Part B for the first time in 2016.
It’s also important to know that the income thresholds for the higher-income 2016 premiums are determined by the adjusted gross income on your 2014 federal tax return – the latest one the IRS has on file.
In addition, 2016 will see a hike in the Part B deductible—up to $223 from this year’s $147. There’s no grandfathering for the deductible increase. It will affect all beneficiaries.
The law covering the disproportional Part B hikes isn’t anything new. The same thing happened when there was no COLA in 2010 and 2011.
The cold comfort is the next time we see a positive annual COLA – hopefully for 2017 – the normal premium relationships will be restored. That is, the people being made to overpay in 2016 will actually see their premiums drop, as they did after the previous zero-COLA years.
Law or no law, MOAA thinks it’s wrong to foist the whole premium load on the few – and some in Congress agree.
Sen. Ron Wyden (D-Ore.) and Rep. Dina Titus (D-Nev.) have sponsored legislation in their respective chambers to extend the grandfathering protection to all Medicare beneficiaries.
Act now to send your elected officials a MOAA-suggested message, urging them to support these bills and protect all Medicare beneficiaries in 2016. (Click on here or above or go to Here is the Process: at the end of this Email to send messages to the President GF)
Issue 3. AGENT ORANGE SCAPEGOATING
October 16, 2015
At a recent hearing on the future of the VA health care system, Rep. Tim Walz (D-Minn.), complained that his MOAA-supported bill – H.R. 3423, an extension of the Agent Orange Act (AOA) – was allowed to expire in September. Walz, an Operation Enduring Freedom veteran and retired Army National Guard sergeant major, hoped the bill would be bundled with other expiring measures in a VA “extenders package.”
Under the extension, the VA would renew an agreement with the National Academy of Sciences (NAS) to evaluate the scientific evidence regarding links between certain diseases and exposure to dioxin and other chemical compounds in herbicides.
This includes any association between exposure to herbicides in Vietnam and diseases suspected to be associated with such exposure.
The evidence produced would form the basis of any recommendation from the NAS’ independent Institute of Medicine (IOM) to add medical conditions to the list of diseases presumed caused by exposure to the herbicides. The AOA gave the Secretary of Veterans Affairs express authority to decide whether to authorize veterans’ disability benefits for the diseases (and effectively required him to do so if the evidence indicated the link).
The IOM expects to finish its final report on Agent Orange exposure in March 2016. With the expiration of the AOA on Sept. 30, some believe an extension is essential to assure the report is implemented by the VA.
The House Veterans Affairs Committee thinks an extension is unnecessary because the Secretary already has general rulemaking authority to add more diseases to the presumptions list.
Walz’ office staff said they were told through informal discussions that the Congressional Budget Office estimated the cost of H.R. 3423 in the billions.
Congress’ hand-washing failure to extend the virtual mandate leaves Secretary Bob McDonald in a difficult position.
If he decides to add to the list of presumptive diseases, politicians and deficit hawks likely will blame him for incurring huge new government costs. (When former Secretary Eric Shinseki added three diseases to the Agent Orange presumptive list in 2010, hundreds of thousands of new claims flooded the VA system, helping to create the mountain of backlogged claims only recently brought under control.)
On the other hand, if McDonald doesn’t act promptly to add diseases based on reasonable evidence from the IOM, he’ll be accused of not taking proper care of Vietnam veterans.
MOAA thinks the VA Secretary deserves more congressional support in his exercise of this national responsibility.
Here is the Process: There are some minor changes below this week and if the steps below are new to some, I recommend that you review all of the steps and then you might want to copy this process by high lighting all of the steps below. Then click on “File” at the top of your screen, select “Print“, then click on “Selection” at the next display and then hit “Print“; or print the selected portion as you usually do this kind of task.
- Click here onhttp://capwiz.com/moaa/issues/ or copy and paste it in your browser to put you at the “Legislative Action Center” screen.
- Scroll downunder “Current Action Alerts” and below “Congress” click on “Protect All Medicare Beneficiaries in 2016 ”.
- At the next screen scroll down to the TAKE ACTION NOW! lineand enter or confirm your Zip code and /or hit “Go!”
- At the next screen under“COMPOSE MESSAGE” leave the recipients area checked at your discretion.
- Scroll down to the “Editable text” areaand edit/modify the text of the message if desired,
- Insert “Your Closing” (I show ‘Respectfully), and “Your Name” and fill in the rest of the mandatory {asterisked} SENDER INFORMATION. The “Phone”number is now required by some Legislators (it’s required if your Senator is from Arizona) .
- Fill in the “Guest Type“, “Service“, “Rank“, “Component“, and “Status” if you want that information to show in your message (recommended). You may be prompted to include a phone numberif you try to send the message without entering your phone number. Don’t be concerned about entering a phone number. I haven’t received return calls except on rare occasions to thank me for my interest in a particular piece of Legislation, at which time you can comment (pro or con) to the staff member on how the Senator stands on the issue.
- Check “Remember Me” (recommended) if you don’t want to have to re-enter all of your Sender Information the next time you send a message. You can always change your information or uncheck ‘Remember Me’ anytime in the future.
- Hit “Send Message”
- If Printed Letter was selected at Step 4 above, at the screen after hitting “Send Message” leave “Plain Paper Style” and “Word Processor (RTF)” checked unless you have another preference. Then left click on “Print Letter(s)” at the end of the “PRINT LETTER” screen. At the File Download” alert that appears next, click on “Open”. You can then edit and print or save the letter for editing, printing, signing and mailing.
- For Arizona residents, because of some continuing problems with contacting Sen Flake by Email,you will see after hitting “Send Message” at Step 9 above, that “Printed Letter” is the most readily observable option for getting your message to him. Step 10 above tells you how to do that..
That’s it for today- Thanks for your help!
