Congress is debating cuts to Medicaid that could impact heavily on Notch Babies. Medicaid is the joint state and federal program that supplies health care to low-income seniors, disabled and children. The amount of the cuts under consideration would be roughly equivalent to the cost of extending a tax cut on capital gains and dividends — the bulk of which benefits about only 4% of American households with incomes over $200,000.
TSCL is concerned that cuts of the magnitude under discussion would leave states with far less finances to meet the routine health care needs of some of the poorest and sickest seniors. Cuts could reduce the number of seniors receiving Medicaid or affect the access to services they receive, including nutrition programs and nursing home care.
Many Notch Babies, especially those who rely on Social Security for most of their income and have few assets, are likely to live close to the federal poverty level. According to an on-going study for TSCL by Advisor editor, Mary Johnson, a Notch Baby who retired with an average monthly benefit of $460 in 1984, receives a benefit today of about $847. That’s only $50 above the federal poverty level for individuals in the 48 states and D.C. and below the federal poverty level in Alaska and Hawaii.
TSCL opposes cuts to Medicaid, particularly because rising health care costs are taking an increasing portion of seniors’ Social Security benefits. Many Notch Babies are now at the age where chronic long-term health conditions may warrant nursing home care in the near future. Medicaid is the program that pays nursing home costs for two-thirds of seniors.
Borrowing, and more deficits are not a good answer to the growth in Medicaid costs since Medicaid has been growing at an annual pace of about 10%. TSCL supports efforts in the Senate led by Senator Gordon Smith (OR) to protect Medicaid from across the board cuts and to establish a commission to study and make savings recommendations. Please contact your Members of Congress and urge them to protect the access to health care for lower-income seniors.
Sources: “Budget Resolution Would Require Much Deeper Cuts in Key Low-Income Programs,” Parrott, Sherman, and Hardy, Center on Budget and Policy Priorities, March 30, 2005.
June 2005
