Letter to the Editor,
Today is my 64th birthday, which puts me one year away from signing up for Medicare. Of course, I could be collecting Social Security already, but in consultation with my financial advisor, I am in a position to use other retirement sources and defer Social Security until I am 70. I am curious to see what happens to these “entitlements” over the next few years.
The idea of reigning in, delegating more funding (e.g. block grants to state for Medicaid, etc) to states, if not eliminating entitlement spending is not a new idea. I recall a conversation with a friend at the beginning of the first Trump administration. He had worked on The Hill for his career and was at that time consulting with the Heritage Foundation. “We can now go after entitlements like Medicaid, Medicare, Social Security…” was the beginning of his conversation.
This begs the first question: is Social Security a retirement investment program? Or, was it intended as a “widows and orphans (e.g. disabled persons)” fund to prevent the most vulnerable from living on the streets or being denied health care?
Social Security was enacted in the 1930’s as part of the New Deal when many elderly lived in squaller, were malnourished, and dying from untreated medical conditions. Medicare was enacted in the 1960’s as part of the Great Society, to address the lack of medical insurance that people faced when they retired.
The Moorefield Examiner’s article (4-2-25, “Social Security Trustees’ Report…”) outlined the dilemma in the financial numbers.
The question is how to change directions.
Social Security and Medicare are programs that will take a generation to change. In other words, those relying on them now do not have the resources (unless they are going to start working at a local store, gas station, or restaurant) to live without them. Thus, changes need to be either/both merit based and age based.
Merit: these benefit could be assessed at tax reporting time, in a similar fashion to the Affordable Care Act Market Place insurance. If someone brings in a certain amount of income (working, investments, rentals…), their benefits could be reduced on a sliding scale.
Age: at the time of Social Security and Medicare programs starting, people lived less than 5 years beyond becoming eligible. Now, many retiring at age 65 can anticipate living 10 to 20 years. The age at which people could begin to collect these benefits could increase with the reality of our increased life span. Someone could be encouraged to defer collection to a higher age such as to 65, 70, and 75.
Another alternative would be to direct payroll deductions into savings accounts similar to 401k’s, 403b’s, and IRA/Roth IRA’s, which are currently optional. We would need to do more education of employees to assure them that these funds are theirs to invest with financial advisors assistance (which needs to be monitored to keep shady people preying on vulnerable employees). Social Security benefits could also be paid out in lump sums, again with caution against scammers. Of course, there should be a floor to the benefits with that “widows and orphans” protections in mind.
Similarly, Medicare could become both merit and age based, with incentives for people to seek alternative health insurance options until age 70 or 75. Health Savings Accounts might be part of the option. But, that “widows and orphans” floor should remain to protect the most vulnerable in society.
Oscar Larson
Baker, WV
