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Should “means testing” exist for Social Security and Medicare? - The Hill
In this somewhat unconventional opinion piece, the author opines that both the Social Security and Medicare programs are suffering financial difficulties, largely because many who receive benefits do not actually need them. The author, himself a fairly affluent businessman, contends that although he is eligible for and has earned benefits from both of these federal retirement and healthcare programs, he can afford to pay for his retirement and healthcare from his own resources, and doesn’t really need government assistance. He posits that requiring a “means testing” criteria for benefits would go a long ways toward restoring both programs to financial soundness.
This, of course, is not the first time the idea of “means testing” has been floated. In fact, some in Congress have advocated for years that those who are more affluent should shoulder an increased tax burden to improve the programs’ finances. For its part, the Association of Mature American Citizens (AMAC) has advocated, as part of its Social Security Guarantee , that Social Security benefit payments could be tailored to a person’s financial status to help improve the program’s finances.
In any case, this interesting perspective on Social Security and Medicare reform opines that “People who don’t need help from the government shouldn’t be automatically getting it. Means testing should be required to qualify for Social Security and Medicare. Rather than just receiving checks once a certain age is reached, recipients should have to prove that they are in need of these funds.” Click here to read the full opinion piece by Gene Marks, appearing at The Hill.
As an example of the leading thoughts on reforming Social Security, the Association of Mature American Citizens (AMAC, Inc.) believes Social Security must be preserved and modernized to meet the demands of 21st-century economics. AMAC’s position is that this can be achieved without payroll tax increases via relatively slight program modifications, including cost-of-living adjustment (COLA) process changes and modifications to the formulas for calculation of payments to higher-income beneficiaries. Changes to the age for maximizing benefits are included in AMAC’s position, along with (1) an increase in the thresholds where benefits are subject to income tax; (2) indexing of these thresholds annually to account for inflation; (3) improved survivor benefits, (4) eliminating the reduction in benefits for those choosing to work before full retirement age; and (5) improved savings tools for future retirees, including a savings account that builds estate value. AMAC is resolute in its mission that Social Security be preserved for current and successive generations and has gotten the attention of lawmakers in D.C., meeting with many congressional offices and staff over the past decade.
I believe means testing is fair. Those with adequate resources to feed themselves and house themselves and medical care should spend that money first. There are people that have a couple million dollars in the bank, and then there are people who had zero and are just surviving. They had the ability to feed themselves and to keep a roof over their head. There are many people who do not except for social security. Those who do not have those resources should get the money first. It may not be fair, but I think that’s the way it’s going to have to be.Because these millionaires get to sit on their money while they’re taking money out of the mouths of people who could use it. Sorry, but the world’s a different place today and those that need it should get it. Not those who already have lots of money in the bank make them spend their own money their own 401 k and roths or whatever else first and then they can get on social security!
Sandra:
Thank your for your comments. We appreciate hearing from our readers and learning about their perspectives on Social Security matters. You raise a point that is perpetually under discussion as the work toward resolving Social Security’s insolvency problem evolves.
Although it’s not readily apparent, Social Security already includes formulas that tend to curtail benefits for high earners. This is not “means testing” in the strict sense of the term, but it does have the effect of lowering benefits for high income earners while increasing benefits for those with lower career earnings. As the article notes, AMAC’s Social Security Guarantee proposal, which you can read in full here: https://amac.us/social-security-guarantee, also contains several provisions designed to further close the gap in calculated benefits between low earners and high earners.
It’s a fine line that lawmakers need to walk, since Social Security’s progressive design is often viewed as being at odds with the program’s intent to base benefits on one’s work history (since it’s characterized as an earned benefit). Nevertheless, we will continue to advocate for changes that promote the fundamental intent of Social Security: to provide financial security and basic well-being for people throughout their lives, particularly those who are old, disabled, or have lost a family member.
If you review AMAC’s Social Security Guarantee proposal, we welcome any comments or suggestions you have. Until the final gavel, it’s still a work in progress.
Thanks again for your comments.
Gerry Hafer, Social Security Advisor
AMAC Foundation
The above is intended for information purposes only and does not represent legal or financial guidance. It presents the opinions and interpretations of the AMAC Foundation’s staff, trained and accredited by the National Social Security Association (NSSA). NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other governmental entity. To submit a question, visit our website (amacfoundation.org/programs/social-security-advisory) or email us at ssadvisor@amacfoundation.org